- Bitcoin price plunged by nearly 10 percent after failing to sustain above $10,000.
- The cryptocurrency has covered part of its recent losses, now trading above $9,100.
- But a confluence of technical and fundamental catalysts are pointing to a deeper downside correction towards sub-$6K levels.
Bitcoin is trading above $9,100, up almost 3.5 percent on a 24-hour adjusted timeframe, as it attempts to erase its recent losses.
The benchmark cryptocurrency closed the previous week at nearly 10 percent in losses. The downside move appeared after it failed to break bullish above $10,000 – a short-term resistance level.
The price eventually crashed towards $8,700 earlier this week that followed a rebound back above $9,100.
Bitcoin’s price action hinted at a bias-conflict among traders. Their buying sentiment appeared weaker near the local tops above $9,500.
At the same time, they defended bitcoin’s support levels around $8,700, creating a modestly wide consolidation range with no preference for the next direction.
That leads analysts to look for hints in the old fractals. A combination of at least three crucial technical and fundamental factors predicts that the next move is extremely bearish, with downside targets lurking in the sub-$6,000 levels.
#1 Historical 30-40% Bitcoin Price Corrections
The first reason why bitcoin risks falling below $7,000 is its historical response to parabolic bull cycles.
Prominent analyst Josh Rager highlighted the fractal back in 2019 when the cryptocurrency was on its way to top near $14,000 in a wild upside rally.
He noted that Bitcoin typically logs a 30-40 percent pullback on average after its price explosions, mentioning eight of such moves in the cryptocurrency’s 11-year lifetime.