Bitcoin Rally Fuels Debate Over Whether Clarity Act Hopes Are Already Priced In

• Erald Ghoos, CEO of OKX Europe, believes clearer US crypto regulations could reinvigorate the market, particularly as some capital appears to be shifting from AI-related assets back into Bitcoin.
• Bitcoin’s recent price movement has been relatively subdued, offering little excitement for traders searching for stronger momentum.
• However, a closer look at the technical picture suggests BTC may be forming a bullish structure that could potentially support a move toward $76,000.
• The pattern in question is the widely followed inverse head-and-shoulders formation, which typically develops near the end of a downtrend. It consists of three successive lows separated by temporary rebounds, with the middle low forming the deepest point.
• The deepest trough represents the strongest phase of selling, while the higher low that follows can indicate that bearish momentum is beginning to weaken.
• The pattern is considered complete when the price breaks above the neckline, a resistance line drawn through the highs between the three lows. Such a breakout is generally viewed as confirmation of a potential trend reversal.
• Bitcoin’s daily chart appears to show the structure. A decline toward $60,000 in early June could represent the left shoulder, while the deeper move to around $57,700 in late June or early July forms the head. The subsequent rebound from approximately $62,500 could represent the right shoulder.
• Each of these lows was followed by a recovery toward a similar resistance area, creating the basis for the neckline.
• Connecting those recovery highs places the neckline near $66,800. A decisive move above that level would be viewed by technical traders as confirmation of the pattern.
• Based on the pattern’s depth — measured from the neckline to the head — a confirmed breakout could produce a projected target around $76,000.
• Technical chart patterns are subjective, however, and not every analyst would consider Bitcoin’s current structure a textbook inverse head-and-shoulders formation. Chart analysis involves interpretation rather than precise rules.
• Even so, the inverse head-and-shoulders is widely regarded as a relatively dependable bullish reversal pattern.
• Chart-pattern specialist Thomas Bulkowski ranks the formation 13th among 39 patterns for performance and reports an 11% failure-to-break-even rate. His analysis of thousands of traditional equity charts found that 71% of these patterns reached their measured targets, while 65% first pulled back to test the neckline.
• For Bitcoin, the pattern remains incomplete and should not be treated as a confirmed bullish signal. The setup would only become active if BTC breaks above the neckline and manages to hold that level.
• There is also a potential obstacle to the bullish outlook: expectations surrounding the Clarity Act have weakened, reducing the likelihood of a regulatory catalyst that some traders had anticipated.
• That uncertainty means investors should remain alert for renewed selling pressure even as Bitcoin’s technical structure points toward a possible breakout.
• On the downside, the 50-day simple moving average is an important level to monitor and currently sits near $63,321.
• A decisive move below that average would weaken the bullish setup and could signal that the inverse head-and-shoulders formation is failing rather than developing into a breakout.

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