Bitcoin News Today: Bitcoin Breaks Below Rising Wedge Amid 8% Correction and Bearish Technical Signs

Bitcoin's recent price action has raised concerns among analysts as the cryptocurrency breaks below a rising wedge pattern, signaling potential bearish momentum. Following the record high of over $124,500 four days ago, Bitcoin has corrected nearly 8%, with further declines appearing likely if the bearish technical pattern continues to unfold [1]. The breakdown below the wedge’s support trendline suggests a test of key support levels, including the $110,000–$112,000 range, which, if breached, could open the door to a drop toward $105,000–$108,000 [1].

The breakdown of the rising wedge, a well-known bearish reversal structure, has been emphasized by analyst Captain Faibik, who notes that Bitcoin has been compressing higher highs and higher lows since April toward the apex of the pattern [1]. According to traditional technical analysis, such a breakdown often precedes a sharp decline. Applying the standard wedge breakdown formula, which subtracts the maximum height of the pattern from the breakdown point, Bitcoin’s downside target could fall as low as $88,000 [1].

In addition to the wedge breakdown, Bitcoin’s price structure also shows signs of a double top pattern similar to the 2021 formation, which was followed by a 77% correction. Analyst Swissblock highlights the potential for a similar bearish scenario to unfold, with Bitcoin at risk of dropping to around $94,750 by September if the pattern mirrors the 2021 outcome [1]. This scenario is further supported by Bitcoin’s recent weekly close, which suggests a weakening in buying momentum [1].

On-chain data also indicates growing selling pressure from large holders. The number of mega whale addresses—those holding over 10,000 BTC—has declined to a yearly low, with a sustained negative 30-day trend since mid-July, according to Glassnode [1]. Similarly, the count of whale wallets holding between 1,000 and 10,000 BTC has also decreased, reflecting profit-taking at recent highs. These trends, combined with the technical breakdowns, heighten the possibility of further price declines unless strong spot demand returns [1].

However, the current environment differs from the 2021 bearish phase. Then, Bitcoin peaked just as the Federal Reserve began tapering and shifting toward quantitative tightening (QT). In contrast, the odds now favor a 25-basis-point rate cut in September, according to CME data [1]. This potential liquidity shift could counterbalance the technical weakness in the short term, Swissblock argues, and maintain the broader uptrend in Bitcoin’s price. Moreover, the persistently growing global money supply (M2) has led some to predict a price target of $132,000 or even $170,000 in the coming months [1].

While the short-term outlook for Bitcoin appears bearish, the broader macroeconomic environment, including the potential Fed rate cut and expanding money supply, offers a counterbalance to the technical sell-off. Whether the price can rebound toward the wedge’s upper trendline at around $125,000 will depend on its ability to hold above the 50-day EMA, a critical support level during Bitcoin’s more than 50% rise since April [1].

Source: [1] Bitcoin price rising wedge breakdown: How low can BTC go? (https://cointelegraph.com/news/btc-price-rising-wedge-breakdown-how-low-can-bitcoin-go)