Bitcoin is testing its recent lows and is at risk of breaking key support levels, which have been crucial in sustaining its bull run.
Bitcoin’s Price at Risk of Falling Below Key Support
On July 5, Bitcoin’s price dropped by 5%, according to data from TradingView, and now traders are focusing on critical support levels that need to hold.
Trader Matthew Hyland points to the $52,000 mark as the key level to watch. This price point is where Bitcoin’s supertrend indicator support sits on weekly charts. This indicator has been a crucial foundation since Bitcoin reached its all-time high of $73,800 in mid-March.
The supertrend indicator uses average true range to set a line that defines buying and selling phases for Bitcoin. The price has remained above this line since the end of 2022, marking the end of Bitcoin’s last bear market.
Historically, Bitcoin’s drawdowns from all-time highs have been around 38%, so the current drop to $52,000 is still relatively mild. Previous dips have seen Bitcoin fall to around $45,750.
Adam Back, founder and CEO of Blockstream, suggests that investors should stay calm and view this as an opportunity rather than a cause for concern. He notes that previous bull markets have seen multiple 30% drops and advises holding onto Bitcoin and possibly investing in MicroStrategy, a company with the largest Bitcoin holdings among public companies.
“Reminder, zoom out. Previous bull runs had several 30% drops too. We’re currently down about 26%,” he said on X (formerly Twitter). “Recent drops seem less severe, but people forget the typical pattern. Don’t panic, buy the dip, or consider buying some $CMSTR with Bitcoin.”
Analyst: Bitcoin’s Pattern is Repeating
Analyst Rekt Capital is also not worried about the current dip, suggesting that Bitcoin’s price movements are following historical patterns.
Disclaimer: Remember that nothing in this article and everything under the responsibility of Web30 News should be interpreted as financial advice. The information provided is for entertainment and educational purposes only. Investing in cryptocurrency involves inherent risks and potential investors should be aware that capital is at risk and returns are never guaranteed. It is imperative that you conduct thorough research and consult with a qualified financial advisor before making any investment decision.
