Traders fear further decline to $10,000

The crypto market is currently experiencing increased volatility. Global economic conditions are deteriorating amid rising inflation and rising interest rates.

Sentiment in global financial markets remains negative, with many crypto investors saying that Bitcoin (BTC) could fall as low as $10,000 before it finds a bottom.

BTC/USDT 1-Tages-Chart. Quelle: TradingView

Many traders have thought it impossible for BTC to fall below its 2017 all-time high. However, the recent drop to $17,600 suggests that this bear market could be different than the last one.

How likely do analysts see Bitcoin dropping to $10,000 in the next few weeks?

Past declines point to lows near $10,350

The possible short-term BTC development can be seen from the bear market cycles of 2013 and 2017. In 2013, Bitcoin’s maximum decline was 85 percent, spanning a period of 407 days. The maximum decline in 2017 was 84 percent and spanned 364 days.

Historical Bitcoin declines. Source: Arcane Research

According to a report by Arcane Research, the current decline has been running for 229 days and the maximum so far has been 73 percent.

Arcane Research explained:

“If Bitcoin follows the patterns of these cycles, it should bottom sometime towards the end of Q4 2022, up to $10,350.”

While an 85 percent drop is always possible, according to Arcane Research, it also said, “Bitcoin is now much more intertwined with the financial market at large, with the US Federal Reserve, US elections, crypto regulation and the stock market all shaping up influence.”

Cryptocurrency research firm Delphi Digital provided further evidence that a drop to $10,000 is possible. She posted the chart below, commenting, “From a market structure perspective on the longer timeframes, we need to look next to the $10,000 to $12,000 area.”

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Brave New Coin Index for Bitcoin (BLX), 1-month chart. Source: Delphi Digital

According to the chart above, support is likely to lie between $9,500 and $13,500.

Delphi Digital further said:

“This area also sits at the expected bottom of BTC’s 85 percent decline from its all-time high.”

Is $10,000 a Good Entry Point?

Not all analysts expect a drop to $10,000. Blockware Solutions’ Will Clemente is more optimistic. According to Clemente, the current bitcoin range is a good time to buy.

Data from analytics firm Glassnode also shows that Bitcoin’s 200-week moving average, balance price, and delta price in their bear market bottom model aligns with the 0.6 Mayer multiple analyzed by Clemente.

Bitcoin bear market bottom model. Source: Glassnode

Glassnode explained:

“Circumstances were similar on only 13 out of 4,360 trading days (0.2 percent). This case has only occurred twice before, namely in January two cups 15 and in March 2020. These points are marked green on the chart.”

According to the delta price, which remains untouched, the potential BTC low is $15,750.

BTC/USD 1 month chart. Source: Twitter

John Bollinger, the inventor of the popular Bollinger Bands indicator, believes toothat Bitcoin may have already bottomed out.

Bollinger said:

“A perfect double top (M-shaped) in BTC/USD on the monthly chart. Confirmation by BandWidth and %b leads to the lower Bollinger Band. No sign of it yet, but that would be a logical place for a bottom.”

The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Every investment and trade involves risk and you should do your research before making a decision.

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