The recent decline in the price of Bitcoin (BTC) has raised concerns about the cryptocurrency’s upcoming performance, with some analysts warning that another key BTC close could signal the start of another major correction.
Bitcoin faces another major crash
On Friday, Bitcoin fell more than 7% intraday to a three-week low of $65,700, raising concerns about the short- and medium-term performance of the flagship cryptocurrency. Since the crash in early February, the cryptocurrency has been trading at levels between $65,000 and $72,000.
Following the recent decline, Altcoin analyst Sherpa noted that maintaining current levels is crucial as a loss of this boundary could quickly cause the BTC price to drop 6-10% down to the next support area, around $60,000-62,000.
Several market watchers have also warned that the cryptocurrency is currently breaking a key bearish pattern, which could also trigger a massive collapse to modern lows if the price does not recover soon.
It is worth noting that Bitcoin has been forming a bear flag pattern on the daily time frame for almost two months, repeatedly testing the lower boundary of the pattern. However, BTC now risks losing this level as support as it shows many worrying signs.
Ted’s pillows he stated on X that Bitcoin not only falls in price but also loses momentum as it has lost its RSI uptrend. “A major sign of weakness,” he added.
The analyst also emphasized that a BTC crash “is only a matter of when, not if,” warning that the flagship cryptocurrency had already broken a similar two-month bear pattern earlier in the year.
Meanwhile, Ali Martinez suggested that BTC could drop another 30-45% based on its historical performance over the past decade. As he explained, Bitcoin has started a modern bull run after falling below the price realized by its long-term holder, and its standard deviation band is -0.2, located at the levels of $48,387 and $36,657, respectively.
“I will be watching these zones for dip-buy opportunities ahead of the next bull cycle,” he said.
All eyes on BTC weekly close
Rekt Capital analyst highlighted another worrying sign for Bitcoin, noting that BTC has once again fallen below the 200-week exponential moving average (EMA). Amid this decline, the cryptocurrency is once again treating this level as resistance, with focus on the upcoming weekly close.
The analyst previously explained that “If the 200-week EMA is lost as support this week and the Weekly Close price is below it again, Bitcoin could actually turn the EMA into new resistance.”
Last week, the largest cryptocurrency by market capitalization technically closed below the 200W EMA after attempting to “retest it after breaking through” as support, but did not end the week above the $68,000 area. “This means that price has technically initiated a breakout from the EMA,” and a weekly close below this level would confirm this.
“Given the recent weekly close, there is therefore a possibility of dipping back into the 200-week EMA for another retest to see if BTC can consolidate a bounce into support,” he detailed. “However, general suspicions have been confirmed: the 200-week EMA acts as both incredible resistance and incredible support, without ever really confirming a clear role.”
The analyst concluded that indecision could lead to further retests in this area “before it ultimately evolves into additional macro deterioration over time.”
At the time of writing, Bitcoin is trading at $65,600, down 6% on a weekly basis.
Featured image from Unsplash.com, chart from TradingView.com
