Bitcoin (BTC) Head and Shoulders Pattern Could Be Forming, XRP (XRP) Drops Below 200-Day EMA

The fabled Head and Shoulders pattern is one that Bitcoin seems to be forming that could be crucial and is raising eyebrows among analysts. Bitcoin cooled off

The fabled Head and Shoulders pattern is one that Bitcoin seems to be forming that could be crucial and has analysts raising eyebrows.

Bitcoin cooled off after peaking at almost $96,000, forming what might be seen as the pattern's right shoulder. Early April saw the establishment of the left shoulder at about $84,000, the head peaking at about $96,000 and the neckline falling between $85,000 and $83,000.

This setup usually comes before bearish reversals as it suggests a potential trend change, however, the narrative is broader with Bitcoin's current macro and technical background in mind, as patterns are only as strong as the context in which they form.

Bitcoin displayed the golden cross, a bullish technical signal where the 50-day moving average crosses above the 200-day moving average, earlier this month.

Its recent formation in May helped fuel the push of Bitcoin to its cycle high and, historically, it has marked the beginning of notable upward trends. However, since then, price action has stalled. Bulls are losing steam with the RSI cooling off from overbought conditions and a lack of follow-through volume.

Although the momentum is slowing down, there isn't an immediate collapse just yet. A more substantial correction could occur if Bitcoin drops below the neckline ($87,000-$88,000), potentially leading to a retest of the 200-day EMA, which is sitting close to $86,000. For now, it's still too early to bet against Bitcoin.

The pattern could be completely invalidated by a strong bounce from the neckline, especially if macro drivers or ETF flows take over. While the overall trend remains bullish for the time being, the next significant directional move will likely be decided by this range, which is between $93,000 and $88,000.

Either a bearish reversal is confirmed or a new leg higher is beginning, and Bitcoin stands at a crossroads. There should be more clarity in the coming days.

XRP is showing signs of trouble as it returns to the 200-day Exponential Moving Average (EMA), often seen as a reset point for assets transitioning from a bearish to a bullish phase.

Following its recent rally, which stalled around the $2.30 mark, XRP dropped below crucial short-term moving averages, including the 50 and 100 EMAs.

It is currently holding onto support at the 200 EMA, which is sitting at around $1.98. This level is a crucial point of no return. If it holds, then XRP is still capable of displaying a long-term trend. However, the outlook is far from bullish.

The decline is accompanied by decreasing bearish volume and a Relative Strength Index (RSI) that is cooling off from overbought conditions and currently stands at 42, edging closer to oversold territory but not quite there yet.

If XRP breaks through this support and closes below the 200 EMA, it could have serious implications. The psychological $2 mark may give way to a deeper decline; the next support is likely to form around $1.90 or even lower, at the $1.75 zone, which was last tested in early April.

On the other hand, bulls would need to regain the $2.15-$2.17 area to reverse the decline and show signs of life. Additionally, that level coincides with the EMA confluence that XRP has now dropped below, indicating that it is a confirmation zone and a resistance cluster for any recovery.

In essence, technically XRP is starting over. It is currently struggling to preserve its long-term structure after losing recent bullish gains.

A break below the 200 EMA could also shift the overall narrative back to bearish in the near term, in addition to suggesting another correction. On the fundamentals of its trend foundation, it is currently a waiting game.

Dogecoin is showing several warning signs as it loses touch with key support levels.

The main point of concern right now is DOGE's drop below its 50-day Exponential Moving Average (EMA), which is presently at about $0.17.

This level, which served as temporary support during the most recent consolidation phase, has been broken by the meme coin, placing it in risky territory.

At the moment, DOGE is trading close to $0.165 above a fragile horizontal support level. If this fails, there is stronger base around $0.145, which has historically been a bounce zone, and the next major support is seen at $0.155.

To reenter a bullish posture, DOGE must recover $0.17, with the next resistance checkpoints being at $0.20 and $0.216.