Bitcoin (BTC) has been on a sharp downtrend over the past two weeks and is facing steady declines due to selling pressure, market volatility and negative sentiment weigh on its price. During one of the recent market crashes, a crypto analyst noted that BTC had officially fallen below the critical four-month support level, putting the cryptocurrency in a precarious position. The expert now outlines what could happen next, and none of the proposed scenarios indicate this a new bull run– instead, Bitcoin could be headed for an even deeper bear market decline.
Bitcoin Price Crash Breaks Key Support
Crypto market expert Aralez announced in an X-post on June 2 that Bitcoin had officially broken a crucial four-month support level that had kept its price stable. The latest drop saw the cryptocurrency lose more than 8% of its value in one day, falling below $69,000.
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Aralez explained that Bitcoin’s first goal during this bearish phase was to fill the Chicago Mercantile Exchange (CME) gap in the range of $74,000 – $81,000. Its accompanying price chart shows that the CME gap was completely filled earlier in May when Bitcoin briefly took off rose to over $80,000. At the time, the cryptocurrency was trading within a tight rising channel, defined by an upper resistance trendline and a lower support line.
This channel had driven the price of BTC higher until the last crash, which saw the price fall below the lower limit of the pattern, close to $70,000. Since crossing the $80,000 mark, Bitcoin has recently entered a rather scary downtrend crashed below $63,000 after losing the $70,000 support.
At the time of writing, Bitcoin is trading just above $62,000a drop of more than 2.3% in the past 24 hours and more than 15% in the past seven days. Analysts following this bearish trend add that further declines could occur until a bottom forms under $60,000officially ending the bear phase.
As for Aralez, he noted that a sharp sell-off immediately after hitting upside targets is usually a strong indication of that the downward momentum of the cryptocurrency is far from over. As a result, he predicts that Bitcoin’s next move will likely be a brief bounce to higher levels before the price drops to new lows again.
Analyst Outlines BTC’s Latest Bearish Play
In his analysis, Aralez outlined his roadmap for Bitcoin over the next 30 to 60 days. He first predicted that BTC could return to the $71,000-$72,000 range and consolidate there for a while. Then the analyst expect the cryptocurrency to drop sharply towards lower liquidity levels of $65,000-$63,000.
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Once that range is reached, Aralez predicts a brutal sweep below $60,000, suggesting a potential Bitcoin bottom almost $55,000. He warned investors not to confuse the current market with the start of a new bull run. Instead, he said the market is looking more like it a classic bull trap that could catch many investors off guard.
He added that the Bitcoin path of least resistance points to lower levels. As the cryptocurrency continues its decline, he urged traders and investors to avoid becoming exit liquidity.
Featured image of Pngtree, chart from Tradingview.com