dailyhodl.com
A closely followed crypto strategist is weighing in on potential downside moves for Bitcoin (BTC) after the king crypto crosses $27,000.
Pseudonymous analyst Credible Crypto tells his 345,900 followers on the social media platform X that Bitcoin could dip to around $24,900 and still remain on track for a bull market cycle.
“I have marked off the most important levels on this chart here:
- Blue level (around $26,400): official confirmation of the incoming dip.
- Orange level (around $25,600): ideal downside target for this dip.
- Red level (around $24,900): bullish invalidation, we shouldn’t go below here.
How low will we go? Depends on how far momentum can push us.”
The trader says he is keeping a close eye on Bitcoin options open interest (OI) as one metric to help indicate the near-term market bottom.
“One metric you will want to pay attention to is OI. You can see on the chart [above] that less than half of the OI that increased on this pump has been closed thus far. If we break below BLUE, it should trigger some liquidations to push us towards ORANGE and OI should begin to close (indicates those who just longed getting washed out). When OI from this pump has completely reset, it’s probably a good indication that the majority of downside is complete.”
According to the trader, if Bitcoin holds above $24,900 in the near term, the king crypto is still on track to form a bullish cycle.
“In a perfect scenario, we make a move below ORANGE, taking all the liquidity below us, but hold above RED, keeping the bullish market structure intact. Let’s see how things develop.”
The trader also says that Bitcoin could be forming a corrective Elliott Wave W-X-Y pattern, which could bring the king crypto down into the $25,000 range before a breakout past $28,000, confirming a bull market.
According to the trader, Bitcoin is unlikely in the near term to overcome the resistance at the $27,000 level after a retest.
“Note we are now at the actual resistance, so the path of least resistance is technically back down in the short term.
IF we clear $28,000, we are FULL BULL as per my last video update.
Until then, here at $27,000 and logical resistance, makes sense to be a little cautious.”
BTC is trading for $27,368 at time of writing, up 0.2% in the last 24 hours.
Generated Image: Midjourney