On Thursday, Bitcoin experienced a notable push towards the $87,000 threshold, with the broader cryptocurrency market gaining momentum following significant news and developments. However, after this brief surge, Bitcoin appears to be losing its upward momentum. Despite the decrease in BTC’s price, many analysts remain optimistic, anticipating a bullish reversal that could take the cryptocurrency to new heights.
Next Leg-Up For Bitcoin Eyes New Targets
After a small rebound, Bitcoin’s price has begun to decline once again. The asset encountered strong resistance at the crucial $87,000 mark, leading to a rapid retracement to the $83,000 support range.
Even in this downward trend, crypto analyst and trader Mags has indicated several positive signals suggesting a potential bullish upswing in the short term. According to Mags, Bitcoin might be on the brink of a significant rally, provided it can maintain stability at a critical support area.
This support level could serve as a springboard for further gains, potentially positioning BTC for a new all-time high. Mags views the anticipated rally as a valuable opportunity for traders who missed previous dips to $25,000 and $52,000.
While monitoring Bitcoin’s performance during this bull run, Mags pointed out level 45 of the weekly Relative Strength Index (RSI) as a solid support area linked to the last two local bottoms. This level may provide crucial support against recent downswings.
The first significant test took place when Bitcoin fell to $25,000, which was followed by a remarkable rally of over 193%, driving the value back to the previous peak of $73,100. Following another low of $52,000, Bitcoin achieved a price increase of 107% to reach its current all-time high of $109,400.
At present, the asset faces its third test after a plunge to $76,000. Given past patterns, Mags believes this could lead to a significant rise to new levels in the coming weeks.
If the weekly RSI at level 45 holds and trends back towards the declining trendline, Mags anticipates a price increase of 64% from this position. A movement of this nature would elevate Bitcoin’s value to approximately $128,000, aligning with the 1.618 Fibonacci extension level.
BTC Market Moves Into Extreme Fear
As the market moves sideways, the Bitcoin Fear and Greed Index has once again dived into the Extreme Fear zone, indicating heightened anxiety among investors. This shift suggests that traders are becoming increasingly cautious as Bitcoin struggles to maintain critical levels.
Even though this may appear concerning, Mags has observed that extreme fear has often preceded strong recoveries in BTC. He highlighted that the index previously fell to Extreme Fear when Bitcoin was valued at $54,000 in September 2024.
At that time, BTC experienced a price surge of over 102%. With the index now indicating extreme fear, Mags believes Bitcoin could see a price reversal in the short term.
