Bitcoin’s price has been falling steadily for more than two months. Back in early October, it reached a high of over $126,000. But now, it has dropped approximately 30%, and as of today, its price is about $88,000.
Some experts are discussing whether this drop means we are entering a bear market (a period when prices keep falling). Others think it might just be a normal pause or correction during a bull cycle (when prices are generally rising).
Bitcoin Needs a Bounce Back
A well-known analyst named Ali Martinez shared his thoughts in a recent post on X (formerly Twitter). He said that for Bitcoin to turn positive again, it must move above a specific price level called the short-term holder realized price. Right now, that key level is about $102,000, which means Bitcoin needs to rise by 15-16% to reach it. If this happens, it might indicate the start of a new upward trend.
What Does the RSI Signal Say?
Another analyst, known as Merlijn The Trader, is looking at another tool called the Relative Strength Index (RSI). This tool is like a measurement that tells us whether Bitcoin is overbought (too expensive) or oversold (too cheap).
The analyst pointed out that Bitcoin’s RSI went below 30 about three weeks ago. When RSI is below 30, it often means the asset is oversold, and prices could rise again. He also mentioned that in such situations, the market tends to stay flat for about 20-25 days before something big happens. Since Bitcoin is now past the 20-day mark, Merlijn thinks an ‘explosive bounce’ or a strong price increase could be just around the corner. He says, “Every time RSI dips below 30: Sideways grind into explosive bounce. We’re on day 20.”
The Risks of Going Lower
Although there’s hope for a price rebound, there are risks too. Ali Martinez shared more data showing that big investors, known as whales, have sold over 160,000 Bitcoin in the past year. Whales are individuals or institutions that hold large amounts of Bitcoin. When whales sell, it often leads to bigger drops in price or happens during difficult market times.
Bitcoin funds known as ETFs (Exchange Traded Funds) also saw investors pulling out nearly $500 million in just the last week. Martinez warned that if Bitcoin’s price falls below $83,300, it could drop much further, likely down to $63,000. Right now, the $83,300 level is acting as a safety net, keeping Bitcoin from falling further.