Consensus says $22,400 marks the start of potential downside territory, but downside technical targets extend as far as $11,000.
Bitcoin (BTC) is trading at its lowest level since mid-December 2020 on June 13, but the bottom could be anywhere.
As the sell-off intensifies over the weekend, BTC/USD has fallen below its strike price for the first time since March 2020, data from Cointelegraph Markets Pro and TradingView confirms.
Bitcoin is clinging to the realization price
Around $23,400, the realized price — the average price each BTC has recently moved — acts as the first solid support on the lower timeframes.
Bitcoin realization price vs BTC/USD chart. Source: glass node
Previous levels, including those marked as potential lows, have failed and sentiment continues to favor further selling pressures thanks to the impact of Celsius, inflation and the upcoming Fed action.
Where BTC/USD can make the final macro bottom is now a heated debate.
Traders and analysts agree that the first signal for a significant drawdown is the 200-week simple moving average (200 SMA).
At $22,370 on June 13, the 200 SMA has acted as a key support throughout Bitcoin’s lifetime, with only brief outflows below this level marking a generation spot price bottom.
The 200 SMA has never broken its uptrend and it is hoped that reaching this level will give the bulls a pause.
Weekly candlestick chart of BTC/USD (Bitstamp) with 200 SMA. Source: Trade View
“People want to buy there, the likelihood of prices rebounding in that area is more than high,” Josh Rager said in a special video update of the day.
He described the 200 SMA bounce as a “self-fulfilling prophecy” due to the level of interest and warned that there is a guarantee BTC/USD will not drop further this time around.
This is thanks to historical precedent showing Bitcoin falling 84% below its recent all-time high. So, at $69,000, that bottom would only be $11,000.
“That would be catastrophic; I don’t think the price will go that low, I mean you’re basically seeing a full pullback of the entire bull market and we’ve never seen anything like it,” Rager continued.
Areas of interest instead are the 2017 all-time high near $20,000 and the area immediately below, extending to $17,000. Also worth looking at is $14,000, down 80 percent from current all-time highs, he added.
As Cointelegraph reported, some of these levels have already been flagged as potential bottoms by others, including trader and analyst Rekt Capital.
The 200 SMA level reappeared in a series of tweets on June 13th.
The Fed is becoming the bulls’ last chance saloon
Meanwhile, at the time of writing, BTC/USD has managed to avoid a further decline in line with US stock markets.
Related: Lowest Weekly Close Since December 2020 – 5 Things To Know About Bitcoin This Week
The S&P 500, on the other hand, lost 3% in the first hour of trading, while the Nasdaq Composite lost 3.6%.
Some argue that only the Fed can halt the cryptocurrency’s fall by reversing monetary tightening as rising interest rates slow growth.
“Realize how little this crypto dump has to do with Celsius and the stETH drama and how it all ties into the widespread panic over risky assets (both stocks and cryptocurrencies) and broken charts,” said economist, trader and entrepreneur Alex Krueger to Twitter followers. day and shrugged off news about Celsius.
Another post said:
“That’s just my opinion, I’m often wrong. From my assumptions, Celsius adds 1.2x to the fuel. Everyone does it because of Celsius. Follow the media tomorrow. But that wouldn’t have happened if it wasn’t for Friday’s CPI numbers and the stock market crash.”
However, long-time Bitcoin market participants had few illusions. If BTC/USD breaks below $20,000, it will be the first time it breaks the previous halving cycle’s all-time high.
“Barring a Fed rollover, I expect this to be the first cycle where Bitcoin falls below all-time highs from previous cycles,” concluded Charles Edwards, CEO of management company Capriole.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Cointelegraph.com. Every
