BITCOIN CRASHING: The $35K Worst-Case Scenario (Emergency Update)

Crypto Market Analysis: A Deep Dive – Gareth Soloway (Verified Investing)

Key Concepts:

• Bare Flag Formation: A bearish technical analysis pattern indicating continued downward momentum after a brief consolidation.
• Path of Least Resistance: A principle in technical analysis stating that price will follow the easiest path, often dictated by prior price action and psychological factors.
• Pivot Points: Significant price levels that historically acted as support or resistance.
• Measured Move: A technique used in technical analysis to project the potential price target after a chart pattern breakout.
• Head and Shoulders Pattern: A bearish reversal pattern signaling a potential trend change.
• Dollar-Cost Averaging (DCA): An investment strategy of buying a fixed dollar amount of an asset at regular intervals, regardless of price.
• Fibonacci Retracements/Levels: Used to identify potential support and resistance levels based on Fibonacci ratios.

Bitcoin (BTC) Analysis

Gareth Soloway analyzes Bitcoin’s recent price action, highlighting a significant bearish pattern. Bitcoin experienced a 5% drop, equating to approximately $4,000, on the day of the video. He identifies a “bare flag” formation, a continuation pattern, which he anticipated weeks prior. This formation consists of a sharp price drop followed by a consolidation phase (inside bar). The inability of the price to break above a key resistance line confirmed the “path of least resistance” downwards.

The breakdown from over $90,500 to $80,000, even briefly piercing $80,000, signaled further decline. Soloway emphasizes the importance of understanding human psychology in technical analysis, as charts reflect collective investor behavior. He notes that the inability to overcome resistance mirrors real-life tendencies to choose easier paths.

He recalls accurately predicting the Bitcoin high in October 2021 by observing a trendline connecting the 2017 high to the 2021 high. Repeated rejections at this trendline foreshadowed the subsequent downturn. He points out a similar bare flag formation occurring after the initial rejection.

Next Support Levels: A breach of the current low would likely lead to a test of the $74,500 - $75,000 pivot point, where a bounce is expected, but not a bottom. He anticipates further testing of lower levels. Drawing parallels to the 2017-2021 bull cycle, where a 25% drawdown from the high provided support, he suggests a potential support zone around $50,000 (based on a 25% drawdown from the $69,000 high).

Buying Strategy: Soloway plans to begin accumulating Bitcoin in the sub-$70,000 range, utilizing dollar-cost averaging to mitigate risk and capitalize on potential future gains. He acknowledges the difficulty of pinpointing exact market bottoms and emphasizes the effectiveness of DCA.

Worst-Case Scenario: A “head and shoulders” pattern is identified as a potential worst-case scenario, contingent on a significant (20-30%) decline in the stock market. The target for this pattern, calculated using a “measured move” (projecting the distance from the breakout below the neckline), is $35,000 - $36,000. He notes this target aligns with the average decline observed in past bear markets (70-80%). He stresses this is a worst-case scenario and doesn’t currently base his strategy on it.

Ethereum (ETH) Analysis

Ethereum’s chart also displays a bearish pattern, mirroring Bitcoin’s. A broken trendline, previously acting as support, confirms the downward momentum. The price dropped from $3,000 to $2,300. Soloway identifies a potential buying opportunity around $2,100, based on a pivot low and high. This is considered a short-term swing trade target. A more detailed worst-case scenario analysis for ETH will be presented in a future video.

Solana (SOL) Analysis

Solana is experiencing a more severe decline, breaking through a key pivot low from January 2024 and April 2025. This breakdown suggests a potential double bottom formation, presenting a swing trading and accumulation opportunity. However, the ultimate bottom remains uncertain.

XRP Analysis

XRP’s chart is concerning, as it has broken through significant long-term support established since February 2025. This breach creates an “air pocket” with limited support levels at $140 and $110. The repeated tests and ultimate failure to hold the support level are viewed negatively.

Broader Market Context

Soloway notes that silver recently experienced a 30% daily decline, highlighting the risk across various asset classes. He observes that silver’s behavior resembled that of an “altcoin” or “memecoin” due to its rapid and speculative price increase. He believes the stock market is the last major asset class yet to experience a significant correction. He warns that if the stock market fails to rally and break out in the coming week, a 10-20% correction is likely, potentially exacerbating the downturn in crypto.

Quote: “The charts are just a majority of the time right. All right. So, that's the key, guys.” – Gareth Soloway, emphasizing the reliability of technical analysis.

Synthesis/Conclusion:

The crypto market is currently facing significant headwinds, with Bitcoin, Ethereum, Solana, and XRP all exhibiting bearish patterns. Soloway’s analysis emphasizes the importance of technical analysis, particularly identifying key support and resistance levels, flag patterns, and understanding the psychological drivers behind price movements. While acknowledging potential downside risks, he outlines a strategy of selective accumulation using dollar-cost averaging, focusing on identified support zones. He cautions investors to remain vigilant and prepared for potential further declines, particularly if the stock market experiences a correction. The overall outlook is bearish, but opportunities for strategic buying exist for those who understand the technical landscape.