Crypto analyst Melika Trader has raised alarms regarding a significant volume drop that could potentially trigger a 60% crash in Bitcoin’s price. In this comprehensive analysis, Trader explores the ramifications of such a decline and whether it signifies the conclusion of the current bull run.
How The Bitcoin Price Could Crash By 60% And Drop To $49,000
In a detailed post on TradingView, Melika Trader outlines how Bitcoin’s price could fall by 60%, potentially landing at $49,000. He identifies that BTC currently hovers just above a critical support zone, which many traders perceive as crucial from a volume perspective on Binance.
According to Trader’s chart, the Bitcoin price may suffer a drastic drop once it loses the former trend line at $75,000. The cryptocurrency is at risk after breaching the critical support around $83,000. Such a decline would revert BTC towards the high-volume range near $30,000, presenting an ultra-bearish outlook. However, Trader adds an interesting twist, indicating that only 20% of traders might suffer losses. He highlights that based on Binance’s volume profile data, most buying activity and position accumulation occurred below $35,000.
Trader also points out that the majority of long-term holders and astute investors entered during the 2022/2023 accumulation phase. The Volume Profile Visible Range (VPVR) indicates substantial support beneath the current Bitcoin price, with minimal trading volumes at higher levels. Consequently, the analyst suggests that only a minority of traders purchased BTC during its late-stage bull run above $70,000.
Despite a potential drop to $49,000, most investors are either at a profit or break-even, implying that they remain relatively safe within the market context.
Why BTC’s Bull Market Is Over
In a related analysis, CryptoQuant’s CEO, Ki Young Ju, affirmed that BTC’s bull market is over, correlating with the ongoing price decline. He referenced the ‘Realized Cap’ metric, underlining his belief that the current bull run has concluded. According to Ju, if Realized Cap continues to grow while Market Cap remains stagnant or declines, it indicates that capital is entering the market without driving prices up—a situation characteristic of a bear market.
Ju observes that despite recent large purchases, such as those by MicroStrategy, the selling pressure in the market has been substantial, preventing price increases. He maintains that current data suggests Bitcoin is entrenched in a bear market, emphasizing that while selling pressure could lessen at any time, historical trends show that genuine reversals typically require at least six months. As such, the likelihood of a short-term rally appears slim.
As of this writing, Bitcoin’s price is around $77,000, reflecting a decline of over 7% in the last 24 hours, as per data from CoinMarketCap.
