Bitcoin (BTC) and the entire crypto markets have been facing some levels of instability as the markets experience a bout of sideways trading after losing the upwards momentum that they have incurred over the past several weeks.
Although Bitcoin’s recent drop into the $7,000 region appeared to have put its bullish momentum in jeopardy, analysts are now noting that it may drop as low as $5,400 before the bulls surrender their control fully.
Bitcoin Stabilizes in Upper $7,000 Region as Selling Pressure Mounts
At the time of writing, Bitcoin is trading down less than 1% at its current price of $7,730 and is down slightly from its 24-hour highs of nearly $8,000 which was set earlier today.
Over a one-week trading period, BTC has been oscillating between the lower-$7,000 region and the upper-$8,000 region, which is quickly becoming a fresh trading range that may ultimately lead to a persistent pattern of consolidation.
Importantly, it now appears that Bitcoin could drop significantly further in the near future before it becomes bearish from a long-term perspective.
Josh Rager, a popular cryptocurrency trader on Twitter, discussed this in a recent tweet, explaining that he believes it could drop as low as $5,400 before it falls into a long-term bearish trend, which may mean that significantly further losses are imminent.
“$BTC Pullback Areas: The lowest I see Bitcoin pulling back is the .618 fib ($5404) as any lower would be bearish, IMO. Major confluence w/ previous support/resistance between $6109 to $6814. I’m personally watching for a bounce in this area with major interest near $6400 (VPVR),” he noted.
Analyst: BTC Likely to Find Major Buying Support Around $6,800
Although Rager believes Bitcoin could fall as low as $5,400 before finding strong buying support, another popular analyst on Twitter recently explained that he believes BTC’s critical support level exists at $6,800.
Alex Krüger, a popular economist on Twitter who focuses his analysis primarily on cryptocurrencies, recently discussed the importance of the $6,800 level, noting that several technical formations are pointing to the importance of this level.
“$BTC still vulnerable. Longs once above $7900-$8000 (higher) or on panic flushes (lower). Next support: 7600-7435, 7200, 6800, 6400. 6800 is major, determined by all three price action, moving averages (50DMA) and fibs (Dec lows to 2019 highs). 6400 is the bull market level,” Krüger explained.
It currently appears the Bitcoin and the aggregated crypto markets are sitting at the edge of a precipice, nearing a point at which they will either drop lower and risk re-entering bear market territory, or continue surging higher in the near-future.