Bitcoin Could Face a Sharp Drop to $50K Despite Recent Rally
Bitcoin recently reached $66,000, fueling optimism for a continued rally this month, though some analysts are cautioning about a possible dip to $50,000 before any new highs.
CrediBULL Crypto, a market analyst, argued that while the price increase has sparked bullish sentiment, the situation remains uncertain, with Bitcoin stuck in the $60,000-$66,000 range. He predicts a short-term bounce followed by a drop to $50,000 due to market resistance at the current levels.
Some additional data for added context:
This move up was primarily perp driven, we can see the divergence between perp and spot CVD and short liquidations that helped fuel the move up.
Meanwhile spot has already begun selling off since the spike while OI continues to rise and… https://t.co/sOJpgC7iCM pic.twitter.com/w5wgbHkprL
— CrediBULL Crypto (@CredibleCrypto) October 14, 2024
The recent surge is seen as driven more by activity in the derivatives market than spot trading, with heightened short liquidations adding to the upward movement. This could lead to a pullback as selling pressure builds. Another analyst, BTC Insider, shares a similar outlook, expecting a decline even if prices reach higher levels like $68,000-$70,000.
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Ali Martinez, another crypto analyst, pointed out that Bitcoin’s recent performance is testing its 200-day moving average, which has been a critical point multiple times. If it fails here, a decline to $57,000 might occur before a potential breakout toward a new all-time high of $78,000.
Some remain optimistic, however. Reports suggest that if Bitcoin can hold above $65,000, it could pave the way for a rise to $70,000. Trading firm QCP Capital noted that historical patterns indicate a rally could be underway, similar to those seen in past pre-election cycles, potentially leading to new record highs by early next year.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
