🚨 Beware of Bitcoin's 'Shooting Star' at Record Highs!!
Bitcoin BTC made a spectacular run in 2024, reaching over $108,000, but December’s price action has raised concerns for the bulls. After hitting a record high, BTC ended the month below $94,000, marking its first monthly loss since August. More notably, this two-way price action formed a "shooting star" candlestick pattern, a bearish reversal signal that could suggest the potential for a significant price pullback.
A shooting star candlestick has a long upper wick, a small body, and a minimal lower wick. In BTC's case, the upper wick is nearly four times the size of the body, indicating that buyers initially pushed the price higher, but sellers took control, pushing it back down. This shift in momentum raises the possibility of a bearish reversal, particularly after a strong rally from $70,000 to over $100,000.
The pattern is consistent with broader macroeconomic developments, such as the hawkish projections for Federal Reserve interest rates, which are driving the US Dollar Index DXY higher. These factors signal potential short-term pain for risk assets like Bitcoin.
For the bulls to maintain control, the December low of $91,186 must hold. If BTC dips below that level, it could confirm the bearish reversal hinted at by the shooting star, leading to further price declines. While Bitcoin's long-term prospects remain strong, traders should be cautious of the short-term risks highlighted by this bearish signal.