Fall, to get up better? While some analysts believe that a bottom (market low) was hit on Bitcoin (BTC), others fear a final bearish leg. This is the case of the research manager of Bitwisewho very recently explained his “ maximum pain scenario » with a BTC that could only find the fund at $48,000.
The key points of this article:
André Dragosch of Bitwise spoke of a “maximum pain scenario” for Bitcoin, with a potential plunge to $48,000. Recent bearish pressure on Bitcoin has been fueled by significant capital outflows, but optimism remains for a long-term bullish recovery.
A final plunge for Bitcoin to $48,000?
In a recent interview with The Block, André Dragoschhead of research for Europe at Bitwise Asset Managementdid not hide his fears for the course Bitcoin. According to him, the king of cryptos could lose again in the -20% from its current levels, and thus slipping below $50,000. A fall that he calls “ maximum pain «. The idea: a final movement of panic capable of shaking even the strongest hands before a possible bounce. André Dragosch identifies several key levels to monitor. The 200-week moving average, located around 61 000 dollarsas well as the realized market price, around 56 000 dollarswhich should first act as supports. But if these barriers give way, the price of BTC could slide as much as 48 000 dollars. This precise threshold corresponds to the cost price of long-term holders (long-term holder cost basis). It is a descent to this major psychological level which would define, according to him, the true scenario of «maximum pain», capable of shake up beliefs of the strongest investors. Thus forming the final point of the capitulation.
A final capitulation on BTC, before a bullish recovery?
The analyst also relies on an in-house tool from Bitwise, the “ bottom-cycle probability model «. This experimental model, nourished by several on-chain indicators (data coming directly from the Bitcoin blockchain), began reporting a possible cycle dip last week. His reading nevertheless remains cautious: for André Dragosch, Bitcoin has not yet reached its low point. There pression comes in part from capital outflows. Because the Bitwise framework attributes this recent wave of decline mainly to the weekly net outflows of exchange traded products (ETPs)which reached approximately 2 billion dollars. According to him, this movement is equivalent to the effective sale of nearly 50 000 BTC on the market in a short period of time, which directly fuels the bearish pressure on prices. Despite this picture, André Dragosch maintains an optimistic course in the long term. THE purchases of Bitcoin by corporate treasuries, like Strategycontinue to absorb part of the supply. And institutional adoption, could provide the fuel for the next bullish phase. But before seeing such a bull run again, you will first have to start by making sure you have hit the bottom. The next few weeks/months should give us a first answer to this question.