Bitcoin Hovers on Historic Golden Line – Analyst Warns Breakdown Is ‘Only a Matter of Time’

Bitcoin’s (BTC) worth climbed 4.5% prior to now day, surging again above $106,500 amidst rising optimism that Washington’s shutdown standoff could lastly be resolved this week.

Despite the rebound within the broader market and Bitcoin’s continued maintain of the Golden Line, a high analyst opined that a brutal breakdown is coming.

Major Dump Incoming?

Crypto analyst Doctor Profit said Bitcoin is presently sitting at a historic assist level, and famous that because the starting of the bull market in March 2023, it has by no means misplaced this degree of the Golden Line, which presently sits round $99,200, barely beneath the psychological $100,000 barrier.

They acknowledged that on the weekly timeframe, BTC has at all times bounced above this line and has by no means closed beneath it. As such, if a weekly shut beneath this degree happens, it will be a robust argument for bullish momentum to fade, as this degree is one of probably the most important bull–bear indicators to contemplate.

Doctor Profit stated that though he has at all times purchased extra Bitcoin on the Golden Line all through your entire bull market, and it labored nicely traditionally, this time he isn’t shopping for on the Golden Line and believes that ultimately the crypto asset will lose this necessary degree.

However, the analyst acknowledged that breaking this degree requires robust promoting strain and acknowledged that BTC has bounced from the Golden Line once more, however stated this doesn’t change his macro bearish view. While confirming that he continues to carry shorts from the $115,000 to $125,000 area, they stated a breakdown beneath the Golden Line is simply a matter of time.

There can also be a giant liquidity cluster round $116,000 to $117,000. If the market revisits that area, the analyst will add extra to shorts. There may very well be extra manipulation strikes within the coming days designed to construct liquidity to the draw back. Market makers are usually not able to ship Bitcoin into the subsequent leg down, and so they first wish to create extra liquidity, which the analyst stated seems to be working.

Leverage has elevated closely this week, notably in lengthy positions on altcoins, and this kind of setting is typical earlier than the subsequent main drop.

“Market makers are setting lure after lure earlier than the subsequent leg down. Enjoy your tea, wait, dont over-trade.”

Rally Made Fade Fast

Matrixport additionally noted a potential oversold setup creating. According to its newest commentary, BTC’s RSI just lately dipped to 35, which has been traditionally a zone the place tactical dip-buyers start to re-engage. Despite near-term catalysts corresponding to feedback from Donald Trump hinting at potential $2,000 stimulus-style funds to Americans along with a decision to the US authorities shutdown, Matrixport warned that whether or not this is sufficient to reignite threat urge for food absolutely stays unsure.

ETF knowledge additionally exhibits outflows over the previous week, which signifies institutional capital could also be stepping apart for now, and these catalysts alone might not be adequate to drive a lasting reversal.

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