Since late November, the price trend of Bitcoin has evolved into the so-called 'head and shoulders' (H&S) pattern, indicating that the market may be shifting from a bull market to a bear market.
In November, the price failed to successfully break through the $100,000 barrier for the first time, marking the formation of the left shoulder. Subsequently, the head stage appeared, with Bitcoin rapidly falling from a historical high of over $108,000 to $92,000 in the second half of December. Meanwhile, the current 5% drop driven by economic data has brought the price close to $97,000, suggesting the formation of the right shoulder.
If the selling pressure continues and the price falls below the neckline (the horizontal trendline connecting the two shoulder lows), then this head and shoulders reversal pattern will be confirmed. As of now, the so-called neckline support is located around $91,500.
According to the Measured Move Method, a break below this level could lead the price to drop to about $75,000. This method measures the vertical distance from the 'head' peak to the 'neckline', and then subtracts the same distance from the 'neckline' price point to arrive at a potential downside target.
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