Renowned technical analyst John Bollinger has issued a warning about a potential 'head fake' in Bitcoin's price action following recent market volatility. On his social media platform, Bollinger highlighted a sharp bounce in early August 2025 after Bitcoin plunged to a multi-week low of $111,919 on Bitstamp exchange on August 3, before recovering to $115,732.
The creator of the Bollinger Bands indicator specifically noted this movement resembles a classic Bollinger Band Squeeze – a technical pattern characterized by tightening volatility that often precedes significant price breakouts or reversals. 'The recent bounce in BTC could be a head fake, potentially trapping short-sellers,' Bollinger cautioned. This phenomenon, borrowing from basketball terminology, refers to sharp directional moves that abruptly reverse to catch traders off-guard.
Historical context bolsters Bollinger's analysis: He accurately predicted Bitcoin's July breakout that drove prices to an all-time high of $122,838 on July 14. Current trading sees Bitcoin at $115,229. Notably, Bollinger clarified this pattern doesn't appear in cryptocurrency ETFs due to their weekend trading halt. The warning urges traders to consider historical retracement scenarios like the W-bottom pattern while navigating this volatile landscape.