The price of Bitcoin has been volatile, with the latest drop occurring from its peak of over $73,000 in March to its current level. Analysts are turning to past data to discern trends, as increased selling pressure and concerns among some investors about short-term losses have emerged. Analyzing historical data is crucial to determining whether we are at the market’s peak or experiencing a temporary pause before the trend resumes.
What determines the intensity of this adjustment?
An article published on website X quotes one analyst as saying that the intensity of this adjustment depends on whether Bitcoin is in a “parabola” phase or not. When the price of an asset is in a “parabola” phase, it indicates a rapid increase in value, and at some levels, analysts believe it is unsustainable.
In such cases, prices often decline afterward, but after surpassing significant support levels and even all-time highs, if that’s the case, the decline this time may indicate the formation of a “first cycle peak,” at the all-time high of $73,800 in March 2024. This formation would resemble what was seen in April 2013 and 2021.
However, in another scenario, traders should anticipate a different pattern. Suppose the recent price growth is not unsustainable or parabolic. In that case, under this circumstance, prices are expected to continue declining and retest previous support levels. Analysts predict that prices may retrace down to the support level of $53,600 in the near future. This retracement, analysts suggest, would facilitate the formation of a “smoother curve, similar to 2016 – 2017.”
Impact of Bitcoin Halving
Beyond this assessment, another analyst has brought in the concept of Bitcoin halving cycles for analysis. Typically, based on historical patterns, prices tend to decline before a halving event, scheduled in the third week of April.
This analyst, as mentioned in an article on website X, suggests that the recent rejection and failure of the bulls to push prices higher indicate that Bitcoin prices may be in a consolidation phase between $60,000 to $70,000 in the coming weeks.
Bitcoin continues to face pressure and is poised for further losses in the coming days. From the daily chart pattern, the price of BTC is currently trading below the lower Bollinger Bands, struggling to recover around $71,700.
Although the upward trend persists, buyers will regain control only when the price manages to bounce back, reversing the current loss scenario. This would require increased trading volume.
Source: newsbtc