Frank Cappelleri, the founder of CappThesis, has provided insightful evaluations regarding Bitcoin’s (BTC) technical future.
Cappelleri observed that Bitcoin has been developing an inverse head-and-shoulders formation in recent weeks, suggesting a potential for a significant upward movement.
The expert emphasized that all asset classes will feel the impact when the Federal Reserve begins to lower interest rates, highlighting its particular importance for Bitcoin. He remarked, “In recent years, Bitcoin has shown a strong positive correlation with the S&P 500. Although they don’t always move in sync, extended divergences are uncommon. At times, Bitcoin leads while at other times it follows the S&P 500.”
Looking ahead to 2025, Cappelleri noted that after reaching its peak in January, Bitcoin experienced a decline which served as an early indicator for movements in the S&P 500. He pointed out that both assets reached their lowest points in April and mentioned that even though Bitcoin recently pulled back from its August high point, it is noteworthy how robustly the S&P 500 continues to perform.
Cappelleri indicated that over the last month’s price movements of Bitcoin have formed an inverse head-and-shoulders pattern just beneath $117K. The typical target for this setup is around $127.6K; however if momentum accelerates further uptrend targets could reach as high as $142K.
The analyst highlighted how recently Bitcoin tested and rebounded from this crucial level twice and recalled how a similar breakout led to substantial bullish activity last November. Additionally he noted historically strong performance by Bitcoin during Q4 of each year.
While acknowledging short-term downward trends within an overarching upward trajectory can often signal positivity overall he cautioned about previous breakouts failing to generate considerable momentum lately. According to him weekly RSI readings should approach levels near 80 akin those seen throughout both 2023 and into early parts of next year asserting if achieved “the pathway may open wide for even greater surges.”
“Bitcoin remains pivotal in influencing global risk sentiment with its trajectory being essential not only domestically but also across international equity markets,” stated Cappelleri.
*This does not constitute investment advice.