As US markets opened, Bitcoin experienced a significant price drop, causing a ripple effect across the altcoin market. The decline saw Bitcoin hitting a daily low of $53,346, with the price slightly recovering to $53,570 at the time of writing. The sudden dip raises questions about how long this downtrend will persist.
How Low Will Bitcoin Go?
Last month, Bitcoin’s price varied between $49,000 and $65,000. After failing to break past the $65,000 resistance, Bitcoin started losing support levels. The $55,000 support level has now been breached, paving the way for prices to hover around $53,000.
Crypto analyst Jelle believes that Bitcoin will bottom out within its current channel by October, after which a recovery is expected to begin.
BTC Bottom Target
TraderXO, another analyst, is wary of the potential deeper lows as Bitcoin tests the annual mid-range for the third time. With investor sentiment weak and the Fed poised to cut rates, there is a likelihood of Bitcoin dropping to the $40,000 range. This scenario could be catastrophic for altcoin investors.
Although macroeconomic indicators might generally support cryptocurrencies, charts are influenced by multiple factors. The increase in global liquidity due to Fed rate cuts could stimulate the market, but until then, weakness may persist.
Key Takeaways for Investors
Investors should consider the following points:
- Monitor support and resistance levels closely.
- Be prepared for potential drops to the $40,000 range.
- Understand that macroeconomic factors alone do not drive cryptocurrency prices.
- Wait for signs of increased global liquidity from rate cuts for potential market recovery.
In conclusion, while Bitcoin’s price drop has sparked concern, analysts suggest that the market may recover by mid-October. However, investors should remain cautious and consider various factors influencing the market.
