Bitcoin’s price above $70,000, while encouraging, has not done much to quell expectations that this is just the beginning of the bear market. Some analysts continue to warn investors that this could only be a temporary relief as the real crash is coming. One of these analysts is HAMED_AZ, who took to the TradingView website part why Bitcoin price is still very bearish and why he expects a further crash before the cryptocurrency bottoms out.
Bitcoin price still very bearish
According to HAMED, despite the recent recovery, the Bitcoin price is still very bearish, and this is due to the fact that the price continues to trade within a descending channel. This descending channel appeared on the daily time frame, and since the price broke below support at $79,000 it has completely eroded the bullish sentiment.
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Even now, Bitcoin price is yet to retest the resistance that has now formed after this support level turned into resistance, showing weakness on the part of the bulls. Another important point the analyst makes is that the same zone closely aligns with the 0.5 Fibonacci retracement level. All this together makes it an important level to determine the next wave of action.
If the price of the cryptocurrency continues to correct below the $79,000-$82,000 level, then it is possible that the price will be rejected again, causing it to decline further. This is because this level is an area under control.
What to expect
In the event of a crash, the crypto analyst suggests so another 40% price crash could occur. This would mean that the price would eventually drop below $50,000. The bottom for this move is somewhere around $47,000, which would mean the Bitcoin price would be below 60% from its all-time high.
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“If price reaches this zone and shows signs of rejection or weakening bullish momentum, the market may experience a bearish rejection, continuing the broader downtrend within the channel,” HAMED explains. “As long as the price remains below the supply zone and the upper limit of the descending channel, the dominant scenario favors one bearish sequel after a drop in resistance.”
On the other hand, there is still the possibility that the bulls will regain control of the cryptocurrency. This would happen if the Bitcoin price were to rise and break above $82,000. In this case, it would push towards the upper limit of the descending channel, leading to a potential trend reversal.
Featured image of Dall.E, chart from TradingView.com