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John Bollinger, the man who literally invented one of technical analysis’s most widely used volatility indicators, just pointed at Bitcoin’s daily chart and said something interesting is brewing. On July 2, the veteran analyst identified a developing “W” pattern, more commonly known as a double bottom, that could mark the end of Bitcoin’s recent downtrend.
Bitcoin was trading around $62,500 at the time of the observation, buoyed by a weaker-than-expected US jobs report. The question now is whether the pattern completes or falls apart, and the answer hinges on a single number: $65,000.
What Bollinger actually sees
A double bottom is one of the oldest reversal patterns in the technical analysis playbook. Think of the letter “W” drawn on a price chart: two dips to roughly the same level, separated by a bounce, followed by a breakout above the peak between those dips.
What makes Bollinger’s observation more nuanced than your standard chart-reading is the fractal structure he identified. The larger “W” formation contains smaller nested “w” patterns at its lows, with an “m” shape at the apex.
The pattern emerged after Bitcoin spent weeks grinding along the lower Bollinger Band boundary, testing it multiple times without breaking down decisively.
For the pattern to be validated, Bitcoin needs a daily close above $65,000, which represents the apex of the formation.
Macro backdrop adds fuel to the fire
The timing of Bollinger’s observation wasn’t accidental. Bitcoin’s bounce above $62,000 came on the back of June’s US employment data, which showed the economy adding just 57,000 new jobs. The unemployment rate ticked to 4.2%.
The $82K rejection still looms large
Back in May, the cryptocurrency made a run at $82,000 and failed. That rejection kicked off the sequence of lower prices that eventually produced the pattern Bollinger is watching.
A drop from $82,000 to the low $60,000s represents roughly a 25% drawdown. Even if the $65,000 breakout materializes, Bitcoin would still face significant overhead resistance from that May rejection.
What this means for investors
The pattern requires confirmation that hasn’t arrived yet. Bitcoin’s recent history includes a 25% decline from its May highs.
A daily close above $65,000 turns Bollinger’s observation from an interesting chart curiosity into a tradeable signal. With the jobs data already showing signs of labor market cooling, with only 57,000 jobs added in June and unemployment at 4.2%, upcoming inflation readings and Fed communications could either reinforce or undercut the bullish case.
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