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The largest cryptocurrency Bitcoin (BTC) is trading at $39,727 after a 0.83% decrease in the last 24 hours. Some on-chain indicators suggest that BTC’s price could drop by another 10-15%.
BitMEX CEO Takes Defensive Measures in Bitcoin
Arthur Hayes, co-founder and former CEO of the cryptocurrency exchange BitMEX, recently shared his analysis of the Bitcoin market, predicting a potential 30% drop from the $48,000 level reached after ETF approval. Hayes expects the largest cryptocurrency to find support and bottom out in the $30,000 to $35,000 range.
Adopting a cautious approach, Hayes disclosed that he took a long position at $35,000 dated March 29, 2024, indicating his readiness for a potential decline. Additionally, he liquidated his trading positions in Solana (SOL) and Bonk (BONK) at a certain loss, revealing a strategic move. Hayes also outlined his plan to opportunistically buy, focusing on positions in SOL and WIF if Bitcoin falls below the $35,000 threshold.
Hayes added that the current outlook for Bitcoin is negative, and he is waiting for the price to surpass the $40,000 level for the situation to change.
On-Chain Data Signals Downward Trend
Meanwhile, experienced cryptocurrency analyst Ali Martinez has researched historical trends in Bitcoin price movements, focusing particularly on patterns observed during previous bull cycles.
Martinez identified a recurring behavior where Bitcoin, after the last two bull cycles, tends to retract to the 50% Fibonacci level after reaching the 78.6% Fibonacci level. BTC, mirroring the current market scenario, has reached the 78.6% Fibonacci level again, signaling a potential short-term correction. According to this pattern, Martinez points to a reasonable scenario where Bitcoin could drop to $32,700, aligning with the 50% Fibonacci correction level.
Martinez, focusing on a broader sentiment cycle for Bitcoin, summarized historical transitions from capitulation to hope, optimism, and belief. Following this cycle, typically a concern phase characterized by a price correction emerges. The analyst’s analysis points to a 20% correction in BTC as part of this recurring pattern.
While acknowledging the current decline as reasonable, Martinez maintains optimism by drawing parallels with historical trends. If history serves as a guide, the observed correction could be the last temporary barrier before the overall upward trend in Bitcoin’s price resumes.
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