Is this the beginning of a Bitcoin ‘Blow-Off Top’ or simply a short break?

Ever since this weekend, Bitcoin has been trending lower (and dragging the rest of the major crypto coins down with it). Yesterday I briefly saw $91k in the afternoon and at the time of writing the largest digital currency is trading around $93,300.

Analysis

Is this the start of the dreaded ‘Blow-Off top’ or are we just taking a short break. A brief analysis of the possibilities.

Twice in the past week I wrote about the possibility that we might see a blow-off top (a drop of more than 10-15% after a rapid rise in just a few weeks).

After Bitcoin made a meteoric move higher ever since Donald Trump’s victory became clear in the night of November 5-6, the price of the largest digital coin rose from $67k to a high of $99k in just two weeks, or an increase of almost 40%.

Panic

Whales (individuals or entities that own more than 10,000 bitcoins) therefore started a slow sale since the middle of last week. From the moment we traded above $92,000, most of the buying was done by smaller crypto wallets, while the larger wallets started taking profits, hoping to re-enter at a lower price.

The last time we observed this type of behavior was after Bitcoin set a new All Time High during the 2017 and 2021 bull runs. Back then Bitcoin fell by around 25 to even 35% in the following weeks during the respective ‘Blow-Off Top’.

Pay close attention to the $70,000 support level and how quickly we move back up during any panic dips where whales try to shake out smaller investors.

It is too soon to call this a blow-off, but if we go down two or three more days and descend underneath $80,000 again, it sure is one.