Bitcoin: Analyst warns of severe correction scenario
A widely followed analyst in the cryptocurrency sector has warned of the possibility of an extremely negative scenario for Bitcoin (BTC), even if the asset surpasses the psychological level of US$70,000.
In a strategic analysis session on the YouTube channel TechnicalRoundup, the analyst, known by the pseudonym DonAlt, pointed out that if Bitcoin reaches this mark and suffers an immediate correction, this could weaken all the upward momentum achieved so far.
According to the analyst, Bitcoin, the main cryptocurrency by market value, shows an upward trend on the weekly chart. However, this trajectory could change abruptly if the asset suffers what he called a “false breakout” when it surpasses US$70,000.
Bitcoin Price Analysis
For DonAlt, a possible rejection shortly after breaking this psychological resistance could generate one of the most negative scenarios for the digital asset.
“Last week, Bitcoin reached a new closing high, and unless it falls below $62K, I will take this as a bullish signal on the weekly chart. However, if the price loses this level, the scenario becomes extremely pessimistic”, said the analyst.
He further explained that, even if Bitcoin breaks the US$70,000 barrier, the cryptocurrency can still be considered in a bearish situation if this breakout is followed by an immediate rejection.
DonAlt highlighted that a rejection at this level could undermine investor confidence, leading to a massive sell-off that would leave the chart in an even more negative condition. For him, it would be a more pessimistic movement than a gradual decline from current levels. This is because the enthusiasm generated by a breakout followed by a sharp drop would have a significant impact on the market.
“Currently, what we have is resistance that Bitcoin has already tested three to four times, depending on the period of analysis. If we surpass this resistance and, shortly thereafter, there is a strong correction, this would drastically affect the technical scenario”, detailed the analyst.
At press time, Bitcoin is priced at approximately $69,100, representing a 2.2% increase over the last 24 hours. Despite this slight gain, DonAlt's analysis suggests caution to investors, especially in relation to the possible movement of the asset towards the US$70,000 level.