Bitcoin’s price is currently in a precarious position, and veteran analyst Filbfilb is warning that the cryptocurrency may have more to lose if a particular price chart pattern unfolds as it typically does.
In his recent update on X (formerly Twitter) on January 19, the founder of the trading suite DecenTrader raised concerns about Bitcoin’s descent to monthly lows.
Overnight, BTC’s price dropped to $40,600, representing a nearly 20% decline from last week’s local highs, according to data from Cointelegraph Markets Pro and TradingView.
While it subsequently bounced back above $41,000, many traders and analysts remain unconvinced of the market’s strength in the short term.
Filbfilb is among those expressing concerns, particularly with regards to the three-day timeframes.
He shared a comparative chart illustrating that when the three-day chart crosses below the daily 50-period simple moving average (DMA), it often leads to further downside.
This chart extends back to Bitcoin’s previous all-time high of $69,000, which was witnessed in November 2021.
Notably, Filbfilb has a history of successfully predicting Bitcoin’s price movements, such as foreseeing the cryptocurrency topping out at $48,000 around the time when the approval of United States-based spot Bitcoin exchange-traded funds (ETFs) was announced.
He has also set a similar price target for Bitcoin in anticipation of April’s block subsidy halving.
In the wake of the overnight dip, BTC/USD dropped below its 2024 opening price. Financial commentator Tedtalksmacro pointed out that $40,000 is the next crucial level that Bitcoin needs to hold.
Additionally, some market participants view the mid-$30,000 range as a potential bounce zone in the near future.
Popular trader Crypto Ed, who is the creator of the trading group CryptoTA, expressed caution, stating, “I think we need 1 more (smaller) leg down before we can bounce.
Last night’s bounce is not convincing me…” This suggests that market sentiment remains cautious, and traders are closely monitoring Bitcoin’s price movements.
In conclusion, Bitcoin is facing a critical juncture, with analysts like Filbfilb warning of potential downside if certain price patterns continue.
Traders are advised to exercise caution and closely watch key support levels as the cryptocurrency market remains volatile.
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