Bitcoin dreaded pattern points to Avalanche, VeChain, Math crypto prices dip

Bitcoin price had a strong performance in 2023 amid a confluence of several factors. The coin started the year being fundamentally undervalued after facing several headwinds in 2022 like the collapse of FTX and Terra.

In addition to its cheaper valuation, Bitcoin also benefited from the renewed hopes of central bank easing, spot ETF approval, and the upcoming halving. As a result, its price surged by almost 160% in 2023, its best performance in years.

Analysts are optimistic that Bitcoin has more room to run in the coming months. Besides, data published last week showed that PCE, Fed’s favourite inflation gauge, dropped in November and is approaching Fed’s target of 2.0%.

Therefore, the Fed Rate Monitor tool expects that the first rate cut will start in March next year. Bitcoin and other risky assets like technology stocks tend to do well in periods of a dovish Fed.

Another positive catalyst is that the Securities and Exchange Commission (SEC) is expected to approve a spot Bitcoin ETF in the coming weeks or months. Some analysts predict that this could happen in January.

🚨 BREAKING: 🇺🇸 The US SEC Drops Bombshell Deadline for Spot #Bitcoin ETFs Approval 😳

🇺🇸 The SEC could greenlight all pending Spot Bitcoin ETFs in January 2024 🔥

A thread 🧵 pic.twitter.com/SbTj7Nef5j

— Keyur Rohit (@CryptoKingKeyur) December 25, 2023

For Bitcoin price rally to continue, it needs to overcome a major technical challenge. As shown below, Bitcoin has formed a double-top pattern at the YTD high of $44,500. In most cases, this pattern leads to a bearish breakout.

If this happens, the next level to watch will be at $36,000, which is much lower than the current level of $42,760. This view will be invalidated if Bitcoin moves above the year-to-date high of near $45,000.

If this prediction happens, it means that some of the top-performing cryptocurrencies will start to unwind as well. Those at the biggest risk are coins like Solana (SOL), Avalanche (AVAX), VeChain, and MATH, which have done well in the ongoing altcoin season.

In most cases, altcoins tend to follow Bitcoin’s lead. For example, most of them reached their all-time high when Bitcoin surged to over $67,000 in 2021. They also crashed hard in 2022 as Bitcoin moved below $15,000 briefly.

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