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The recent rejection at the $100,000 level has led to a wave of warnings from top financial analysts, who warn that Bitcoin may be poised for a major pullback towards the $70,000 region, or even $60,000 in some cases. Ali Martinez (@ali_charts), cryptocurrency analyst, Assembled Many market veterans’ views on X, offering multiple perspectives on the potential for an impending correction.
Bitcoin price collapse coming?
One voice in this discussion is Tone Vays, a well-known trader who has expressed grave concerns about Bitcoin’s trajectory. Faiz relayed that Bitcoin trading below $95,000 is “very, very bad” as it increases the possibility of a correction to around $73,000.
In a shared video, Faiz explained: “We are now opening the monthly day trade below $95,000, (…) getting too close to the $92,000 range literally opens up like a Pandora’s box in a massive collapse to $73,000. Now, I’m not saying “It will break down by $73,000. I would say the probability has increased so much that we can easily reach $73,000 as you sit on the last support line.”
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Peter Brandt, another prominent analyst, added to the growing concern by discussing the formation of a “bronching triangle” in Bitcoin’s price chart. According to Brandt, this pattern likely indicates a bounce towards the $70,000 area. Although Brandt was careful to clarify that his statements were not definitive predictions, he emphasized the growing possibility of such a movement.
“Trolls, this is not a prediction. Just always referring to probabilities, not probabilities, not ‘certainty.'” Brandt stated, “No screenshot needed, Bitcoin’s right-angled enlarged triangle could return to $70,000 and test the method.” “The reward.”
In contrast to these bearish views, Fundstrat maintains a more optimistic long-term perspective, forecasting that Bitcoin will reach $250,000 by 2025. However, Mark Newton, global head of technical strategy at Fundstrat, acknowledges the potential for longer-term volatility. Short, suggesting that Bitcoin may experience a decline to $60,000 before embarking on a rally.
In a video shared by Martinez, Fundstrat CEO Tom Lee explained this forecast: “I think Bitcoin, a year from now, is about $250,000. (…) It’s very volatile. People don’t like volatility. Yes , Mark Newton, our technician, believes that the Bitcoin cycle goes down a bit early next year, so perhaps Bitcoin will reach $60,000.
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Adding to the chorus of caution, Benjamin Cowen, CEO and founder of Into The Cryptoverse, posits that Bitcoin’s price movement could mirror that of the Nasdaq 100 Index (QQQ). According to Cowen, this consensus could precipitate a “flash crash” to $60,000, potentially coinciding with Donald Trump’s inauguration day.
From an on-chain analysis point of view, Martinez confirms the bearish possibilities. He notes that if Bitcoin drops below $93,806, the path to $70,085 becomes increasingly plausible, describing the area below as “out in the air all the way to $70,085.” Martinez identifies the critical support zone between $97,041 and $93,806, stressing that failure to maintain these levels could lead to a sharp decline.
He notes that market dynamics suggest that some investors are preparing for such a downturn, as evidenced by the transfer of more than 33,000 Bitcoin (worth more than $3.23 billion) to exchanges last week. Additionally, profit-taking appears to be increasing, with over $7.17 billion in Bitcoin profits generated on December 23 alone.
The percentage of Binance traders with open long positions on BTC also decreased from 66.73% to 53.60%, indicating a shift in market sentiment towards a more bearish stance.
Ultimately, Martinez stresses the importance of Bitcoin reclaiming the $97,300 support area to invalidate the bearish outlook. “Bitcoin recently broke below one of the most important support areas at $97,300. Therefore, for the bearish outlook to be invalidated, BTC must reclaim this crucial support area and, more importantly, maintain a daily close above $100,000.
If Bitcoin can maintain a daily close above $100,000, Martinez posits the possibility of a significant rally, perhaps as high as $168,500 based on the Mayer multiplier. However, failure to do so leaves the door open for expected corrections to occur.
At press time, Bitcoin was trading at $96,905.
Featured image created with DALL.E, a chart from TradingView.com