Despite a slight recovery in cryptocurrency prices on Wednesday, experts remain divided on the future direction of Bitcoin (BTC), Ethereum (ETH), and Solana (SOL). The market is at a crossroads, with some analysts anticipating a deeper correction, while others see the potential for a renewed recovery.
The iShares Bitcoin Trust ETF is currently trading more than 20% below its recent 52-week high, which was reached less than a month ago. This peak coincided with the formation of a bearish evening star pattern, and the ETF experienced a notable decline of 3% on October 7.
This week alone has seen an 8% drop, and the ETF recently undercut its 200-day simple moving average, marking a steep 5.5% decline—the largest single-day drop since April 7.
However, the sharp pullback follows a significant increase of over 220% from early April to late August, making the current retreat appear both prudent and necessary.
Notably, the fund has not yet pierced its 200-day simple moving average, having touched it recently while retesting a breakout above a bullish inverse head-and-shoulders pattern.
The behavior of the ETF around this critical moving average in the coming week will be crucial; if stability can be achieved, it may present an attractive buying opportunity. After facing resistance at the $40 level on August 22, recent price action could be forming a double-bottom base, provided that the recent lows hold.
The Solana ETF peaked on September 18 and has since formed a bearish island reversal pattern. Over the past seven weeks, it has fallen in five of those, with three weeks recording double-digit declines.
Ultimately, the report suggests that a potential recovery for the trio would imply further inflows into these exchange-traded funds. This would also indicate a new wave of bullish sentiment returning to the market.
At the time of writing, Bitcoin is trading at $104,190, marking a 3% surge over the past 24 hours. During the same time frame, ETH and SOL also recorded gains of 5% and 4%, respectively.
Featured image from DALL-E, chart from TradingView.com
