The recent Bitcoin price crash appears to have triggered a sell-off that continues to put bearish pressure on the cryptocurrency. This in turn had an impact on the broader market, causing altcoins to suffer significant losses during this period. While hopes for a quick recovery remain, analysts have warned investors that Bitcoin prices are more likely to plunge further before rebounding. Nonetheless, expectations remain that digital assets will hit bottom and bounce back.
Why a Bitcoin Price Collapse Is Likely to Happen Before a Recovery
Setupsfx, a household name cryptocurrency analyst, has shared a roadmap that Bitcoin price could follow to clear $126,000 again and hit a new all-time high. Contrary to those hoping for a quick rebound, cryptocurrency analysts have warned that the digital asset is likely to suffer a major crash first before green appears on the charts.
With the price of Bitcoin already surpassing $90,000, the optics for the pioneering cryptocurrency continue to look bearish. Accordingly, analysts are expecting a further decline as profit taking worsens. The next major level is now at $60,000-$70,000, which means Bitcoin price will fall by more than 20% again.
However, a plunge to $60,000 would impact the next bullish trend as analysts expect this to be the bottom. Therefore, buying BTC at the $60,000-$70,000 level is ideal, Setupsfx explained. Because once the relief rally begins, analysts expect the price to eventually soar to $150,000.
Nonetheless, cryptocurrency analysts warn investors that they should always consider the volatility of Bitcoin price when investing. Therefore, it is important to have appropriate risk management practices in place as there is no guarantee that digital assets will perform as expected.
Analysts are bearish only in the short term
Bitcoin price collapse before recovery theory was also supported by cryptocurrency analyst Hyperkane, who shared his expectations for the cryptocurrency. Analysts also believe the Bitcoin price could crash below $70,000 before a bottom is established.
But overall, there seems to be a consensus that the Bitcoin price could start to rebound once it falls about 40% from its all-time high. Therefore, the selloff is likely to continue as investors dump BTC in the hope of being able to buy the cryptocurrency again at a much lower price.
Featured image by Dall.E, chart by TradingView.com
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