Bitcoin Price Plummets: Will It Drop to $60,000?

After a two-week decline, Bitcoin’s price has dropped to nearly $95,000, raising concerns among analysts about a potential massive crash that could see the flagship asset plummet to $60,000. Over the past 24 hours, Bitcoin has fallen by 2.5%, with an intraday low of $95,134 yesterday, extending its fortnight losses to 3.7% and causing the asset’s market cap to fall to $1.9 billion.

Bulls Defend Critical Support Level

As bulls strive to defend the critical $95,000 support level, on-chain data and market analysts suggest a higher probability of Bitcoin’s price plummeting to $60,000 by Donald Trump’s inauguration on January 19. According to prominent crypto analyst Ali Martinez, some savvy investors have transferred over 33,000 BTC, valued at more than $3.23 billion, from their wallets to exchanges over the past week, likely anticipating a bearish scenario.

This move typically occurs when investors become cautious and prepare to sell their holdings, expecting a potential price drop or increased market volatility. Further investor profit-taking in BTC also surged on December 23, with Bitcoin holders collectively realizing over $7.17 billion in profits on that day, Martinez added.

Derivative Traders Less Bullish

Derivative traders appear less bullish on Bitcoin’s near-term price outlook, with the percentage of traders taking long positions on the world’s largest cryptocurrency dropping from 66.73% to 53.6%. Martinez notes that the key support level for Bitcoin lies between $93,806 and $97,041, and a failure to hold this critical demand zone could result in Bitcoin’s price correcting to $70,085.

Expert Warnings

Other crypto industry experts have warned that a further decline in Bitcoin’s price below the critical $95,000 support level could trigger a significant drop, potentially pushing it as low as $60,000. Market commentator Tone Vays warned that if Bitcoin’s price falls below $95,000, it could signal trouble and set the stage for a sharp correction down to around $73,000.

Peter Brandt, a veteran trader who famously predicted the Bitcoin crash in 2018, has also expressed concerns that Bitcoin might be on the verge of breaking down from a “broadening triangle” — a bearish signal in technical analysis — which could result in a drop to around $70,000.

Bullish Case for Bitcoin

Despite the bearish outlook, some analysts remain optimistic that Bitcoin’s fall may not be as hard as many are speculating. Georgii Verbitskii, founder of TYMIO, expects the price might only drop to a low of $89,000, citing increased institutional activity in the market backing Bitcoin.

“Typically, there isn’t much liquidity on the market during holidays. Today is the largest expiration of options, so market makers are creating the volatility they need. In the coming days, everything will most likely stabilize and we will witness smooth growth then.”

Pseudonymous trader Titan of Crypto also anticipates a similar drop in Bitcoin’s price to $87,000 during the correction phase before the next upward move toward $110,000.

Tips for Investors

  • Monitor Bitcoin’s price closely, as a drop below $95,000 could trigger a significant correction.
  • Consider the increasing institutional activity in the market, which could provide support for Bitcoin’s price.
  • Keep an eye on derivative traders’ sentiment, as a decrease in long positions could indicate a bearish outlook.

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