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It's holiday time and Bitcoin (BTC) is trading in a downward trend after crashing towards the $87,000 region. Although the cryptocurrency has been struggling for months and has didn’t regain key resistance levels, a crypto analyst believes Bitcoin could still stage an enormous Christmas rally. While the analyst outlines a possible roadmap for this predicted upswing, he warns that an extra price decline to $80,000 and even below stays a high probability.
Bitcoin risks crashing to $80,000
Crypto analyst RBswingtrader divided a Bitcoin market outlook on X the day before Christmas, outlining several scenarios that would determine whether the cryptocurrency continues an uptrend or is about to enter one other downtrend. The analyst noted that smart money is currently buying Bitcoin in a brand new zone and in addition warned that there could potentially be a final price drop Market manipulationcould occur before a trend reversal.
According to his evaluation Bitcoin could still go down to a brand new local low of around $80,000 before strong buyers enter the market. The analyst emphasized the importance of patience and viewed this potential decline as a part of a broader accumulation strategy.
He shared a chart showing BTC trading below a falling orange moving average (MA) after a pointy selloff from the $108,519 resistance zone. The analyst noted that the worth of the cryptocurrency had previously failed within the upper area and moved into a powerful area Downward trend that has been ongoing for weeks.
Source: X
RBswingtrader further identified a transparent result Elliott wave structure on the BTC chart, with waves from one to 5 followed by one ABC correction pattern. Wave 3 accelerated Bitcoin's sell-off, while wave 5 appears to be developing and downside targets are still open. Additionally, several key support levels were highlighted, including $87,106, $86,169, and $83,986.
The analyst warned that a deeper break from these support levels could open the door to a possible decline towards $80,427, with an prolonged lower goal near $74,185 Bitcoin's Selling Pressure intensifies. He also recorded several Fibonacci retracement levels that coincide with the lower support zones for BTC price.
Notably, the quantity data at the underside of the chart indicates a big accumulation trend until December. The increased trading activity supports the view that major players are benefiting from price declines and constructing positions despite Bitcoin's weak price performance.
Is a Christmas rally still possible for BTC?
RBswingtrader's chart depicted a possible Christmas rally for Bitcoin with an upside forecast targeting the $108,519 area if the worth recovers from its current lows. The chart showed that the buildup volume is increasing this December and next yr Bullish Divergence in Relative Strength Index (RSI) could support the upward momentum.
RBswingtrader also noted that a recovery of key technical levels, including the 0.5 Fibonacci retracement near $96,690 to $96,836, could support Bitcoin's potential upward move. At the time of writing, the leading cryptocurrency is trading at around $87,669.
BTC fails to carry $89,000 | Source: BTCUSD on Tradingview.com
Featured image created with Dall.E, chart from Tradingview.com
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