Bitcoin Faces Short-Term Downside Risks as Nasdaq’s Double Top Patterns Signal Potential Decline

On March 4th, COINOTAG reported that, according to CoinDesk, the Nasdaq index has demonstrated a “double top” bearish reversal pattern, which has heightened the short-term downside risk for Bitcoin. Research conducted by Ecoinometrics indicates that Bitcoin’s long-term recovery is significantly tied to the Nasdaq’s performance, with Bitcoin experiencing over a 10% decline within the last 24 hours, effectively nullifying the gains observed on Sunday. Earlier, Bitcoin’s price tested the pivotal 200-day Simple Moving Average (SMA) support level situated at $82,587. The 200-day SMA is a crucial metric for determining long-term trends, and a decline below this threshold often suggests potential for substantial losses. The Nasdaq has formed key peaks around 22,200 since mid-December, with a trough marked at 20,538, closing below this critical support on Tuesday, thereby validating the double top bearish reversal. Technical analysis suggests that any ensuing decline could be a minimum of 70% of the range between the peak and the trough, hinting at a potential drop to 19,400 for the Nasdaq. Should Bitcoin fall beneath the 200-day SMA, the next vital support level would be the previous all-time high of $73,757, now acting as a significant support threshold.