In his newest video revealed on December 21, crypto analyst Rekt Capital tried to reply the query “What’s The Worst Case Situation For Bitcoin Proper Now?”. After reaching a brand new all-time excessive at $108,374 on December 17, the BTC worth is down greater than -11%.
How Low Can Bitcoin Worth Go?
Rekt Capital put the Bitcoin price pullback in a historic perspective, underscoring the historic significance of weeks 6, 7, and eight in a “worth discovery uptrend.” Drawing upon previous cycles equivalent to 2013, 2016–2017, and 2021, he defined that Bitcoin has a powerful tendency to right throughout these particular home windows, with some dips reaching as steep as 34% and even larger.
“Understanding these weeks is essential as a result of they are usually problematic for Bitcoin,” Rekt Capital acknowledged, referencing previous cycles the place important downturns occurred inside this timeframe. For example, in week 7 of the 2013 cycle, Bitcoin skilled a dramatic 75% pullback over 13 weeks. Equally, the 2016-2017 interval noticed a 34% decline in week 8, underscoring the recurring vulnerability throughout these particular weeks.
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As of the present cycle, Bitcoin has undergone a ten%+ retracement, bringing its worth right into a traditionally vital help zone at $96,537 on the weekly chart. Rekt Capital emphasised the significance of this help degree, noting, “This space of historic help has enabled the transfer to $108,000.” He cautioned that failure to keep up this help may set off a extra extreme correction right down to $89,830.
Analyzing the worth motion of the previous few days, Rekt Capital identified the emergence of a bearish engulfing candle within the weekly timeframe—a technical indicator typically related to potential reversals. “We’re dropping resistances that changed into help,” he noticed. This loss signifies a possible transition right into a corrective interval, as the worth struggles to keep up its upward trajectory.
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Rekt Capital additionally identified the significance of sustaining the 5-week technical line in his evaluation. “If we lose this 5-week technical uptrend and the orange development line, it will be mounting proof that we may be transitioning right into a corrective interval,” he warned.
Moreover, he addressed the CME gap between the $78,000 and $80,000 worth ranges, a vital space that has remained unfilled. “Delving into 26%, 27%, 28% dips may fill all the CME hole,” Rekt Capital famous.
Traditionally, CME gaps have the tendency to get crammed whereas there are just a few ones which have by no means been crammed.
Regardless of all cautionary indicators, Rekt Capital maintains a bullish stance within the long-term “These pullbacks are what allow future uptrends within the parabolic section of the cycle,” he defined. Drawing from earlier cycles, he illustrated how corrections have traditionally supplied the required “breather” for the market.
Within the 2021 cycle, for instance, Bitcoin skilled a 16% pullback in week 6 and an 8% dip in week 8, but the general development continued upward. Equally, the present 10% retracement, whereas important, may function a preparatory section for the next leg of price discovery.
At press time, BTC traded at $95,000.
Featured picture created with DALL.E, chart from TradingView.com
