Bitcoin has seen a noticeable recovery trend that has caused its price to rise above $22,000 again. This is a welcome development for a digital asset, which has suffered many downturns, but not so good for cryptocurrencies. As the market continues in a downtrend, there are levels that bitcoin must hold above to maintain these high prices. Otherwise, it risks falling more than 85% from its all-time high.
Bitcoin Should Hold Over $17,000
Several prominent figures in the finance industry have shared their thoughts on where they see the bitcoin price heading. One of those is Clem Chambers, CEO of ADVFN. Chambers, also known as a financial analyst, said that in order for digital assets to continue rising, they must ensure that they do not fall below $17,000.
In the an interview Executed by Daniela Cambon for Stanberry Research, the financial analyst explained that Bitcoin is likely to hit $40,000 if it maintains strong momentum. However, there is still a huge chance that the price will reach the dreaded $10,000 if it fails to maintain the $17,000-18,000 level.
Interestingly, even though the price of Bitcoin is currently on the rise, Chambers believes that a bearish scenario is more likely in this case. This means that the analyst expects the price to drop below $17,000 and reach $10,000.
BTC price drops below $21,000 | Source: BTCUSD on TradingView.com
Chambers’ view is in line with what has been recorded in the cryptocurrency market in the past. Assets tend to lose about 80-85% of their price and even more in extreme cases. This historical trend puts the bitcoin price close to $10,000 before hitting the bottom.
But what does BTC say?
Most of the pumps in the cryptocurrency market lately have been courtesy of the forthcoming Ethereum Merge. The network drew the rest of the market with it by sparking interest in the space. However, since others like Bitcoin are just riding the Ethereum coats, there isn’t much in support of it.
Relief rallies like the ones the market is currently experiencing always lead to profit taking, adding to selling pressure in the market. Glassnode mentions this in its report, noting that there was profit taking at the current level, just like what happened in June, which brought the loss-dominant system down to 0.58, putting it in a bearish territory.
Accordingly, Chambers’ forecast for Bitcoin is likely to drop below $17,000 from a recovery to $40K in a clearer view. However, the Profit margins for BTC holders continue to rise During this time, sparking stronger sentiment among investors.
That buildup quickly followed, although not with the strength required to push the price beyond $30,000. The number of new BTC addresses marked, as well as holdings of old BTC addresses, indicated the aforementioned accumulation trend.
Featured image from Coinpedia, chart from TradingView.com
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