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As Bitcoin (BTC) hovers above the crucial $80,000 support level, market experts are divided on the cryptocurrency’s immediate future. Despite a recent recovery, some analysts warn that a significant price drop may be on the horizon.
Rising Wedge Pattern Raises Alarm
After experiencing a sharp sell-off that saw Bitcoin’s price retreat over 25% from its all-time high of $109,000, the leading cryptocurrency fell to a low of $76,000 on March 11.
Since then, the Bitcoin price has seen a modest 3% increase over the past month, with only a slight 0.7% loss in the last two weeks. However, this recovery has not quelled concerns among some analysts.
Doctor Profit, a well-known market expert, recently shared insights on social media platform X (formerly Twitter), highlighting the formation of a “massive” rising wedge on Bitcoin’s daily chart.
As pointed in the daily chart shared by the analyst below, this bearish pattern suggests that upward momentum is waning and could lead to a breakdown below the $80,000 mark in the coming days.
Rising wedges are often seen as indicators of potential price reversals, and the inability of Bitcoin to consolidate above $85,000 after its recent recovery adds to the uncertainty.
Could Bitcoin Be Poised For A Major Rebound?
In contrast to Doctor Profit’s analysis, another analyst, Ali Martinez, offers a more optimistic perspective. The analyst points to the MVRV Ratio—an indicator that compares market value to realized value—as a potential signal for a buying opportunity.
Ali Martinez suggests that if the MVRV Ratio crosses above its 70-day moving average, it could indicate a market bottom, providing an opportune moment for investors to enter the market.
Martinez also notes that the sell-side ratio has dropped to 0.086%, a level historically associated with major price rebounds in Bitcoin. In the past two years, sell-side ratios below 0.1% have often signaled significant upward movements in Bitcoin’s price, suggesting that there may be renewed buying interest.
With these contrasting analyses, the market is left in a state of anticipation. While Doctor Profit warns of a potential correction below $80,000, Martinez’s indicators point toward a possible uptrend ahead. The current consolidation around $83,000 could either lead to a further decline or set the stage for a renewed rally.
As of now, while trading at $83,400, BTC still records a gap of 23% from its all-time high of $109,000, with a trading volume drop of 49% in the 48-hour time frame amounting to $16 billion.
Featured image from DALL-E, chart from TradingView.com
