Bitcoin (BTC) has been on a rollercoaster ride recently, crossing the $27,000 mark and prompting analysts to weigh in on its potential downside moves. Credible Crypto, a well-known crypto strategist, has shared his thoughts on the matter, suggesting that Bitcoin could dip to around $24,900 and still remain on track for a bull market cycle.
Credible Crypto, who has a significant following on Twitter, highlighted three important levels on the Bitcoin chart. The blue level, around $26,400, represents the official confirmation of an incoming dip. The orange level, around $25,600, is the ideal downside target for this dip. Lastly, the red level, around $24,900, would indicate bullish invalidation and should not be breached.
The analyst emphasizes that the extent of the dip will depend on how far momentum can push Bitcoin. He also mentions that paying attention to Bitcoin options open interest (OI) can help determine the near-term market bottom. Currently, less than half of the increased OI has been closed, indicating that there may be further liquidations and a possible push towards the orange level. Once the OI from the recent pump has completely reset, it could indicate that the majority of downside movement is complete.
Despite the potential for a dip, Credible Crypto believes that Bitcoin can still maintain its bullish cycle if it holds above $24,900 in the short term. The analyst suggests that in a perfect scenario, Bitcoin would move below the orange level, taking out liquidity, but still remain above the red level to preserve the bullish market structure.
Additionally, Credible Crypto points out that Bitcoin may be forming a corrective Elliott Wave W-X-Y pattern, which could bring the price down to the $25,000 range before a breakout past $28,000, confirming a bull market.
However, the trader cautions that Bitcoin is unlikely to overcome the resistance at the $27,000 level in the near term after a retest. Until Bitcoin clears $28,000, it is reasonable to exercise caution, especially as the current price level represents logical resistance.
At the time of writing, Bitcoin is trading at around $27,368, showing a slight increase of 0.2% in the last 24 hours.
As the cryptocurrency market continues its unpredictable journey, it is important for investors to stay informed and keep an eye on key levels and indicators that can help guide their investment decisions.