Technical Indicators Signal Upcoming Price Movements
Renowned technical analyst John Bollinger has identified potential W bottom patterns in Ethereum and Solana charts, utilizing the Bollinger Bands indicator he invented. These formations suggest that a significant price movement could be approaching, particularly if similar patterns develop in Bitcoin's price action.
Bollinger observed that Ethereum and Solana appear to be setting up double bottoms, while Bitcoin continues to form its base. A W bottom in Bollinger Bands is recognized as a bullish reversal signal, indicating potential upward price movement, and is therefore a closely watched technical pattern among traders.
Recent Price Action and Historical Precedents
Ethereum has touched the $3,700 level twice during October and appears to be recovering from those levels. Solana mirrored this movement with a double dip to $175 in October, followed by a minor recovery that aligns with the potential W bottom formation Bollinger identified.
Bitcoin experienced a major V-shaped dip, falling below $104,000 on Friday before recovering over the weekend. The leading cryptocurrency is now trading at the lower band of a range-bound channel that formed in mid-May when it first broke into six figures.
Analyst Satoshi Flipper noted that the last time Bollinger advised paying attention was in July 2024, which preceded a significant rally. Bitcoin surged from below $55,000 to over $100,000 in the six months following that signal, highlighting the historical significance of Bollinger's market observations.
"It is indeed time to pay attention. That's a real Squeeze and the controlling feature is a two-bar reversal at the lower band," Bollinger stated at the time. Following months of tight compression, Bitcoin Bollinger Bands have widened this month as volatility increased with record leverage flush last weekend.
Market Outlook and Analyst Confidence
Analysts had predicted this volatility storm during the market lull in September, making the current price action consistent with earlier forecasts. Bitcoin has failed to break above the support-turned-resistance level at $108,000 since its Friday decline, though analysts remain confident the market hasn't entered bear territory.
Market observer Sykodelic emphasized that markets remain in an uptrend, using the 50-week simple moving average as a technical indicator. The 1W 50SMA has been tagged four times since November, with each instance followed by mass fear and panic-selling before the price rebounded with strength and pushed much higher, suggesting the current cryptocurrency market structure remains intact.