This article is available in Spanish.
Speculations about the The Bitcoin bull market is over are widespread in the crypto market, especially as the price has failed to reach its all-time high above $73,000 in March. A crypto analyst offers a more compelling argument for this story and has a Bitcoin bear case scenario where the pioneer cryptocurrency could fall to $28,000.
Bitcoin Bear Case Revealed
In an X (formerly Twitter) aftercrypto analyst and position trader Bob Loukas unveiled a ‘Bitcoin bear case’, presenting a more unorthodox and bearish scenario for Bitcoin than most analysts have suggested. Loukas bases his bearish scenarios on cycle theory and proposes that Bitcoin could be part of the broader 16-year cycle, with the current market marking the final four-year phase of this cycle.
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The analyst suggested that this four-year phase could end in two ways: a distribution phase prices spike and then a decline, or an upward phase, during which Bitcoin experiences one last rise before a decline begins. Loukas has now revealed this cycle trends can help predict or provide insight into the future price movements of a cryptocurrency, he emphasizes that the “no power law” guarantees that the price of an asset will continually rise.
The analyst wants to desensitize investors to the belief that Bitcoin will be bullish forever without recessions. He states that a bear cycle is inevitable at some point, although the timing remains uncertain.
Loukas pinpointed specific price movements on his Bitcoin chart that could serve as an indicator bearish signalindicating a possible downturn. That’s what the analyst predicts Bitcoin could fall to a new low around $28,500 by 2026. He also predicted that after a period of volatility consisting of price drops and increases, the cryptocurrency could rise again to $59,500 in 2027.
For further clarity, Loukas has proposed a story suggesting that if Bitcoin were to close below the 10-month moving average (MA) during a “bull market‘, would be a cause for concern. Likewise, a monthly close below $58,800 could signal the start of a potential downward spiral.
The crypto analyst has estimated a 10% to 15% chance that this bearish scenario would occur, stressing that this was a possibility and not a certainty. He clarified that while he believes the current market cycle leans towards a more bullish scenario based on historical evidence, he always takes into account alternative scenarios. This approach is likely due to the inherent unpredictability of the crypto market infamous volatility.
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Analyst sees retail activity fueling a downtrend in BTC
While unveiling his Bitcoin bear scenario, Loukas revealed that broader interest in cryptocurrencies beyond Bitcoin has faded significantly. He revealed that there is a lack of new private investors, and this weaken the enthusiasm could pose a serious challenge for Bitcoin to generate new capital for growth.
According to Loukas the disinterest of private investors can arise from a change in sentiment. Embracing cryptocurrencies has become mere speculation, and fewer people believe in their transformative potential.
Featured image created with Dall.E, chart from Tradingview.com