Bitcoin has maintained its overall bullish momentum by fighting off corrections for several months. However, this trend appears to have come to an end, and it seems from the signals used by some market analysts who follow long-term cycle patterns that this particular Correction may be more serious than usual.
Instead of focusing on sharp movements in charts and average numbers, analysts have recently explored a new measure, that of two-year averages.
Market analyst Ali Martinez highlighted that Bitcoin broke beneath the 730-day level for the first time in this cycle. The level stands out around $81,250 and represents a kind of demarcation boundary between strong bull phases and regions where momentum starts to fade. Breaking below it shows that it’s becoming difficult to hold onto dominance.
In past cycles, Bitcoin reached below this level only after large peaks; it had never gone below it before. Hence, the current situation is very unusual in this context.
Despite the bearish long-term trend signal becoming negative, it is apparent that buyers are propelling BTC to new heights. The mid-80,000s have now reached critical levels.
Ted Pillows warns that $85,000 to $86,000 is the key level to watch to determine if market stabilisation will occur.
A firm break above this level may open up the way for a recovery to $89,000, $92,000, and $95,000, which offered strong support earlier in the year.
Otherwise, if Bitcoin fails to reclaim such levels, then the area just above $80,000 makes way for the last major level of support. A break below it would swiftly make way for yet another level at $78,000-$79,000.
In such a case, breaking below the two-year SMA would go from being a warning signal to being conclusive verification of BTC switching from an expansionary phase to a cooling-down phase.
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Currently, Bitcoin is sitting in the mid-$80,000s and hasn’t shown any direction yet. The market is paused and is waiting for what would be the defining moment to either continue to complete the cycle or start to pull back.
At present, all that’s certain about it is that it’s just about to happen and will have direct results depending on which way BTC breaks out.
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