Bitcoin Faces 60% Drop Warning Amid Market Volatility
1min read Crypto analyst Melika Trader has issued a warning about a potential 60% drop in the price of Bitcoin, which could see it plummet to $49,000. This analysis comes as the cryptocurrency market faces significant volatility and uncertainty.
Melika Trader, in a detailed post, explained that Bitcoin is currently hovering just above a critical support zone, which many traders recognize as the most important support level from a volume perspective on Binance. The analyst's accompanying chart indicated that if Bitcoin loses the former trend line at $75,000, it could experience a 60% drop, bringing it down to $49,000. This would place Bitcoin back within the high-volume range near $30,000.
Ask Aime: What will happen if Bitcoin price falls 60%?
Despite the ultra-bearish outlook, Melika Trader noted that only 20% of traders might actually incur losses. According to Binance’s volume profile data, the majority of buying activity and position accumulation occurred below $35,000. This suggests that most long-term holders and smart money entered the market during the 2022/2023 accumulation range. The Volume Profile Visible Range (VPVR) also shows significant support below the current Bitcoin price, with minimal trading volume at higher levels.
Melika Trader further remarked that only a minority of traders bought Bitcoin during its late-stage bull run above $70,000. This means that even if the Bitcoin price retraces back to its base, most investors would still be in profit or break-even. Therefore, while Bitcoin risks a drop to as low as $49,000, most traders are relatively safe from significant losses.
Adding to the bearish sentiment, CryptoQuant’s CEO, Ki Young Ju, recently asserted that Bitcoin’s bull market is over. He cited the ‘Realized Cap’ metric, which indicates that capital is flowing into the market but prices are not rising. This is a clear bearish signal, suggesting that the market is currently in a bear phase. Ki Young Ju explained that even large purchases, such as those by microstrategy, are not pushing prices up due to the high sell pressure.
Ki Young Ju noted that historically, real reversals take at least six months, making a short-term rally seem unlikely. He believes that while sell pressure could ease anytime, the current data points to a bear market for Bitcoin.
At the time of writing, the Bitcoin price is trading at around $77,000, down over 7% in the last 24 hours. This significant drop highlights the volatility and uncertainty in the cryptocurrency market, with analysts and investors closely monitoring the situation for any signs of recovery or further decline.
