Bitcoin Could Plummet to $40,600 According to Crypto Analyst
An expert in the field of cryptocurrency has outlined a potential scenario in which Bitcoin could experience a significant drop to around the $40,600 mark. This projection is based on an observed pattern forming in Bitcoin’s 2-month price chart.
The analyst identifies a Tom Demark (TD) Sequential signal that has appeared in Bitcoin’s 2-month price. TD Sequential is a technical analysis indicator commonly used to identify potential reversal points in an asset’s price.
The indicator has two phases: setup and countdown. During the setup phase, candles of the same color (either red or green) are counted up to nine. Once these nine candles are complete, it is presumed that the asset has reached a point where a turnaround is likely.
If the setup candles are predominantly green, the TD Sequential would issue a sell signal. Conversely, a higher number of red candles would suggest a potential bottom.
Following the completion of the setup phase, the countdown phase begins. Similar to the setup, candles are counted up to thirteen. After thirteen candles, the asset could be considered to have reached another possible top or bottom.
Recent observations indicate that Bitcoin has completed a TD Sequential setup with nine green candles in its 2-month price chart. This suggests that the cryptocurrency may have encountered a significant top.
Since the appearance of this signal, Bitcoin’s price has been trending downwards and is currently below the $57,000 level. Thus, it is plausible that the bearish impact of this pattern is already taking effect.
The analyst also highlights the support level at $51,000, corresponding to the 0.236 Fibonacci Retracement level from the recent Bitcoin peak. Fibonacci Retracement levels are based on the mathematical Fibonacci series, resulting in consistent ratios throughout the series.
While Bitcoin may find support at the next significant Fibonacci ratio, should the $51,000 support be breached, the cryptocurrency could potentially drop further to $40,600, corresponding to the 0.382 Fibonacci Retracement level.
Should Bitcoin reach this level, it would signify a drawdown of over 28% from its current price. The future trajectory of Bitcoin remains uncertain and will be closely monitored by market participants.
As of now, Bitcoin’s price has further declined and currently sits at $56,600.
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