By Shelly Melancon (Switzerland)
BTC price has been declining massively in the last 21 days. The downtrend in the crypto market has also added to the decline in BTC price, with a further decline still a possibility.
BTC Price On Course To Trade At $30K
Following the recent crypto market crash, BTC price has dropped to sub-$40K levels. If BTC’s candlestick closes at sub-$39.5K levels by the end of this week, it means that the BTC price would continue to decline further.
As it currently trades at the $39.5K level, the BTC has broken crucial support created during the last bullish season. Thus, traders that entered the BTC trade at about this support area are now experiencing massive losses following this huge drop which has lasted for more than 21 days now.
If the BTC price downtrend continues, traders can expect another 12% loss, making BTC trade at the $34.37K support range. Even though the bulls might make an effort to reverse this BTC price downtrend at this level, the bears will also intensify the selling pressure until the BTC price trades below the $31.5K level, which is the level the bears can take profit from their short positions.
The sub-$30K levels are Microstrategy’s average BTC buy price and represent the liquidity zone, making the $30K level the next crucial resistance for BTC. An Intotheblock crypto price predictor also forecasts the BTC price decline towards the sub-$30K levels. This predictor reveals an extensive support region for BTC and varies between $11.1K and $34.39k. Stats prove that nearly 2.5m BTC were bought at an average price of $19.7K.
BTC 7-day chart. Source: TradingView
The Latest Crash Is Terrible
Proof of how bad the latest crash was is the amount of BTC longs liquidated globally. As BTC price lost 11.9% within the past 48 hours, traders liquidated about $345m worth of BTC long positions during that time. Investors’ sentiment regarding the price of any cryptocurrency can often be estimated by the number of daily active addresses (DAA).
BTC daily active addresses. Source: CryptoQuant.
In this case of the leading crypto, BTC’s 50-day and 200-day SMA has made a bearish crossover between them. The last time this bearish crossover occurred was May 2021, and during that time, BTC dropped massively from $46K to $29K. A historical repeat might see BTC price hit that $29K level which would coincide with the predictions from the technical indicators.
A Bullish Outlook Is Realistic
The on-chain analytics also agreed with the technical indicators on BTC’s bearish outlook. However, a bullish move over the $39.6K level will invalidate the bearish analysis. The MVRV model is also bullish about BTC. As of this writing, this value is at -18%, indicating that short-term holders are currently losing.
This happened in July last year when BTC dropped to the $29.7K level. Thus, an intense buying pressure might cause the leading cryptocurrency to become bullish again. The first sign of bullishness will be for the 7-day BTC price to close over the $52K region.
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