Bitcoin, the first and largest cryptocurrency by market cap, has hinted at an Inverse Head and Shoulders (iH&S). This formation always invites bulls and has become a point of talk as it suggests a potential surge to $350,000.
Monthly candle shows positive momentum with an inverse head & shoulders pattern
To understand the head and shoulders pattern, the iH&S pattern consists of three key components: the head, left shoulder, and right shoulder. The left shoulder forms after a sharp decline, followed by the head, which represents the lowest point of the pattern.
As Bitcoin’s price moves upward, Bitcoin forms the right shoulder, which retests the neckline from the first two peaks. This is generally a pattern that typically signals the end of a downtrend and sets the stage for a breakout to the upside.
Trader Tardigrade analysis shows that Bitcoin’s price is testing the previous resistance level after it surpassed it. A bullish trend emerges from the latest monthly candle that signifies a positive market direction.
After Bitcoin’s price retested its previous support, it displayed a green candle, a typical sign of upward momentum. This retest was crucial, as it confirmed the strength of the pattern and the potential for further price increases.
Key target price: $350,000
The price target of the iH&S pattern is estimated from the height of the pattern, which is added to the breakout point. For Bitcoin, this target points to a price of around $350,000. If Bitcoin remains on its bullish trend, the technical setup, along with recent bullish price action, makes it possible this target could come to pass.
The market is currently discussing the $350,000 target as a significant level. As of this writing, Bitcoin (BTC) is currently trading at $95,139.61, indicating a 1.99% increase over the last day. A reversal could result in a retest of the current support levels, while a continued upward trend would solidify the breakout.
The market cap is $1.88 trillion, and the 24-hour volume is $40.37 billion. The circulating supply of Bitcoin is 19.85 million BTC out of a total supply of 21 million BTC. This yields a 2.13% volume in the past 24 hours compared to the market cap ratio.
