Four Charts Point to a Possible Bitcoin Bottom After a 50 % Decline
Bitcoin has shed more than half of its value from the all‑time peak of $126 k. Technical analysis across several time‑frames now suggests that the market may be stabilising in the $60 k‑$72 k corridor, setting the stage for a more sustained rally.
Key takeaways
- Double‑bottom pattern on the 12‑hour chart signals that selling pressure could be waning.
- The Bitcoin‑to‑gold (BTC/XAU) ratio has slid to its lowest level in 13 months, a historic precursor to previous bear‑market bottoms.
- A multi‑year descending trend line on the monthly chart is being retested; this line has coincided with past market lows in 2018 and 2022.
- Weekly and daily charts show trend‑line bounces that echo the shape of earlier cycle troughs, while the RSI is edging out of oversold territory.
1. Double‑bottom (“Adam and Eve”) formation hints at a reversal
After tumbling to a low of about $60 k on 6 Feb, Bitcoin rebounded roughly 21 % to a 30‑day high near $74 k before slipping back to the $72 k region. On the 12‑hour chart, analysts have identified an “Adam and Eve” double‑bottom—a variant of the classic W‑shaped pattern—where the price briefly recovered between two comparable lows before breaking above the intervening peak (the “neckline”).
The breakout above the $70 k neckline on Wednesday was interpreted as the first confirmation step of the pattern. If the price can maintain levels above this breakout zone, the chart suggests the downtrend may be losing momentum and a bullish swing could commence.
2. Bitcoin‑gold ratio reaches a cycle‑low
The BTC/XAU ratio, which measures Bitcoin’s price relative to gold, has been in a steady decline for over a year, tracking the broader risk‑off sentiment that typically pushes investors toward safe‑haven assets. Historically, a bottom in this ratio has preceded major Bitcoin recoveries:
- Late‑2022: Ratio bottom → Bitcoin hit a trough near $15.5 k, then rallied >300 % to break its previous high.
- 2018 & 2014: Similar ratio lows were followed by annual gains of 300‑450 %.
With the ratio now hovering near its deepest point since the 2022 trough, the technical narrative suggests that the macro‑level floor for Bitcoin could be forming.
3. Monthly trend line retest reinforces bottom hypothesis
A long‑standing descending support line on the monthly chart—drawn from peaks in prior cycles—has acted as a hinge point for bear‑market bottoms in 2018 and 2022. Current price action shows Bitcoin testing this line again, a move that many chartists view as a “historical test.”
If the market respects this trend line, the next logical step, according to some modelers, would be a move upward that could eventually target the $500 k region over the longer term. The immediate implication, however, is that the price is flirting with a historically significant support zone.
4. Weekly and daily confirmations; momentum indicators
On the weekly chart, analysts have spotted a parallel bounce off the same trend line that marked the 2022 bottom, reinforcing the notion that the current trough mirrors previous cycle lows. Meanwhile, the Relative Strength Index (RSI) on several time‑frames is climbing out of deep oversold territory, adding momentum to the technical story.
One trader noted that the confluence of these patterns—double‑bottom, ratio bottom, trend‑line retest, and improving RSI—creates a “high‑probability bottom” scenario. Nevertheless, the same voice cautioned that the breakout area must hold; otherwise, a secondary dip could still materialise.
Outlook
While the charts collectively suggest that Bitcoin may have reached a near‑term bottom, the path forward remains uncertain. A decisive hold above the $70 k breakout zone, coupled with continued strength in the BTC‑gold ratio and respect for the multi‑year trend line, would bolster confidence in a forthcoming uptrend. Conversely, failure to maintain these levels could trigger another corrective swing.
Investors should keep an eye on volume patterns, macro‑economic news, and on‑chain metrics that could either confirm the technical picture or introduce new volatility. As always, prudent risk management and independent research are essential before committing capital to the market.
Source: https://cointelegraph.com/news/these-4-bitcoin-charts-say-btc-price-forming-bottom?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
