Bitcoin's Bearish Pennant Pattern: Multi-Timeframe Analysis Points to Lower Price Targets

Bitcoin has shifted back to a confirmed downtrend on the 3-hour timeframe, with prices declining from a triangle formation that was established on February 12. This breakdown aligns with the broader bearish pennant pattern we identified earlier, which originated from the February 6 market bottom. While the bearish pennant pattern’s ultimate target sits below $40,000, we acknowledge that such a sharp move requires sufficient upside recovery from the current oversold levels. The more immediate bearish pennant pattern scenario projects a mid-range target around $62,000—a realistic near-term objective.

3-Hour Downtrend: Key Technical Levels and Support Zones

For the ongoing 3-hour downtrend, our primary price targets are stacked at $66,793, $65,835, and $64,878. A critical breakpoint exists at $69,187, which would confirm the continuation of the downward trajectory. Our liquidity analysis on the 3-hour timeframe identifies a tight support zone between $62,740 and $62,929. In the most bearish scenario, incorporating additional targets from higher timeframes and the liquidity cluster, we could see bitcoin test the $56,803 level. The 4-hour timeframe uptrend remains pivotal at the $66,933 breakdown level—if breached within the next 45 minutes, it would solidify the bearish case.

Trade Execution: Strategic Response to Trend Shifts

Our trading protocol triggered an immediate exit when the 3-hour trend changed direction. The long position was closed at $66,854.37, compared to an entry of $69,658.22, resulting in a loss of approximately $71.88 (a -1.23% setback). While a single losing trade might appear to validate the bearish thesis superficially, this perspective overlooks our broader performance. Our strategy has demonstrated profitability over an extended backtesting period using Trading View’s demo account simulation; isolated consecutive losses are merely part of the long-term equity curve and should not override the methodology.

Currently, we maintain an active short position with a mandatory add-on tier positioned at $69,187—precisely at the breakdown level of the stable 3-hour downtrend. The short entry was placed at $67,030, with liquidation protection set at $86,478 on cross-margin. A recovery to that breakdown level remains plausible, as a local bullish wedge is forming from Sunday’s high to the present day. However, the dominant 3-hour downtrend currently works against this upside scenario materializing.

Market Dynamics: Seasonality vs. Trend Momentum

The Chinese New Year historically presents patterns worth monitoring for Bitcoin price action. Our analysis suggests that by February 27, bitcoin could potentially trade above $70,000, aligning with seasonal tendencies. However, trends supersede historical seasonal patterns in our framework. The current bearish pennant pattern momentum and confirmed downtrend may override traditional seasonality expectations, allowing the technical targets outlined above to be reached before any substantial reversal occurs.