Crypto analyst Ali Martinez has indicated that the Bitcoin downturn may not be finished yet, even with the recent relief rally to $61,000. He emphasized the significance of the $60,365 price level in order to prevent a potential drop down to as low as $57,000.
Bitcoin Must Maintain This Price Level to Avoid a Crash
Martinez mentioned in a post on X that $60,365 is a crucial price point to monitor for Bitcoin. He warned that a dip below this level could result in a decrease to $57,420. Conversely, if it stays above this threshold, the analyst noted that a bounce back to $63,300 could be possible. Thus, the future movement of Bitcoin hinges on the critical support at $60,000.
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In a separate analysis, Martinez pointed out that Bitcoin is likely to face additional downward pressure in the short term rather than recover. He stated that since May, each correction of the market value to realized value (MVRV) ratio from its 90-day average has led to substantial declines in Bitcoin’s price.
Along these lines, the analyst indicated that the recent rejection has already caused a 10% drop, implying that Bitcoin could experience further declines. Analyst Justin Bennett also anticipates that Bitcoin will likely fall further and forecasts a potential decrease to $57,000. He suggested that a brief rebound to eliminate the $63,200 short positions would be beneficial.
In the meantime, he referenced the US Job report, which is due to be released on October 4. The analyst predicts considerable volatility driven by this inflation data. A weak job report could trigger a Bitcoin crash, reminiscent of the August decline, when the cryptocurrency fell to $54,000. The inflation report is also crucial as it would shed light on the potential for further rate cuts from the Federal Reserve this year.
Veteran trader Peter Brandt is also adopting a bearish stance on Bitcoin at present. He pointed out a ‘Three Blind Mice’ pattern forming on the BTC chart, suggesting a bearish reversal following the recent uptrend in October.
Why a Price Crash Might Be Beneficial
The on-chain analytics platform Santiment indicated that a Bitcoin price crash might be necessary for the cryptocurrency to rise higher. The platform noted that public interest in crypto has significantly decreased since Bitcoin retracted over 9% from its recent high of $66,400 set on September 27.
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Santiment asserted that this is a positive sign, as markets tend to move contrary to public sentiment. Therefore, the Bitcoin price could experience an unexpected rally, given that market participants are currently more pessimistic about its future.
Ali Martinez mentioned that Bitcoin is currently in a state of complacency and merely requires a cooldown period before its next upward movement can take place.
Featured image created with Dall.E, chart from Tradingview.com
