Some analysts say Bitcoin (BTC) price could fall to $ 27,000 in a bearish scenario if it falls through the $ 30,000 support area.
The potential drop to $ 27,000 depends on BTC having to drop below $ 30,500, where it rebounded sharply on Jan. 11.
What is the short-term bitcoin bottom?
In the foreseeable future, there are three major technical levels for Bitcoin: $ 34,500, $ 30,500 and $ 27,000.
$ 34,500 has been a critical area of support for the past 72 hours. Every time BTC fell to this level, it rebounded pretty quickly to around $ 36,300.
If $ 34,500 goes bust, the next major level of support is $ 30,500. Here, Bitcoin rebounded from the major correction on Jan. 11 when futures contracts worth $ 2 billion were liquidated.
For example, a pseudonymous trader known as “Alex” said that if Bitcoin fell to $ 30,000 with no visible buyer reaction, the trade would be to wait for $ 27,000 or move back above $ 30,000. He said:
“Decision-making is dynamic. Nothing is set in stone. But most likely if the price drops back to 30,000 it will hold back next time. The game board stipulates that you have ammunition to buy the dip (to use it again). If 30K absolutely don’t buy, down to 27Ks or over 30,000 again. “
Similarly, another popular pseudonymous trader known as “Mayne” said the $ 33,000 loss would likely result in $ 27,000. Before the weekly opening of the candle on January 18, the trader wrote:
“I think we’ll stop here ($ 33,000) and get a solid rebound into Monday. If we lose that level, Bitcoin will actually be a scam and I’ll denounce every association I’ve ever had with it, up to $ 27,000. “
What happens to altcoins when $ 30,000 is broken?
Alex pointed out that altcoins would likely be “wiped out” with 30% to 50% corrections if Bitcoin fell back to $ 27,000.
Altcoins are usually less fluid and much less in volume than Bitcoin. Hence, altcoins often see steeper pullbacks during a bear cycle when compared to BTC. The trader stated:
“If BTC drops to 27,000 for any reason, expect alts to be wiped out with intraday pullbacks of 35% to 50%. In this scenario, buying alts is better than buying $ BTC. Definitely better to buy alts there than to buy leverage BTC dollars. Identify the winners and jump in. “
So far, Bitcoin is slowly bouncing back from the USD 34,500 support level, which is a positive trend. It also marks a support level for whale clusters, meaning whales are likely to protect that level with buy orders.
The presence of whale clusters at $ 34,500 explains why Bitcoin has seen sharp jumps in this area over the past 48 hours. In the short term, the key to a convincing rebound would be to protect these levels.