Traders are suggesting that the price of Bitcoin (BTC) may experience a further decline in the near future, based on the analysis of a popular momentum indicator called Bollinger Bands. Bollinger Bands provide insights into potential entry and exit points for trading by using price volatility. Traders typically look to buy when the price nears the lower band and sell when it approaches the upper band. The increased volatility in Bitcoin’s daily price range is indicating to traders that there could be more downward movement ahead.
Some traders have made predictions based on the Bollinger Band analysis. Crypto trader Aqua, with a sizable following of 16,500 on social media platform X, mentioned in a post on April 17 that a close below support could cause the price to expand to the $50,000 range. Stockmoney Lizards also expressed the belief in a correction even with the upcoming Bitcoin halving on April 20, but maintained optimism in the long-term bullish momentum.
Technical analyst Tony Severino compared the current market cycle to that of 2017 and suggested that Bitcoin’s price could experience significant volatility. He stated in an April 16 post that the worst-case scenario, based on Bollinger Band analysis, could be a price of $53,000. Another pseudonymous trader, Rekt Capital, emphasized the importance of Bitcoin maintaining its support levels to prevent a breakdown and a drop comparable to the 18% pullback in March 2023.
According to the trading resource Material Indicators, there is strong buying support for Bitcoin at around 5% below its current price of $64,242. It noted that bid liquidity-based support is forming in the $59,000-$61,000 range, with secondary support levels extending down to $50,000. CoinGlass data suggests that if the price reaches the lower end of this range, approximately $2.2 billion in long positions could be liquidated. There is very little room for Bitcoin’s price to rise before a significant number of short positions would be wiped out. A 1.15% increase to $65,000 would result in the liquidation of $551 million in short positions.
Traders using the Bollinger Bands indicator are anticipating further downside for Bitcoin’s price in the near term. There is still confidence in the long-term bullish momentum of the market. The focus now is on maintaining support levels to prevent a breakdown and minimize potential losses for investors.
These so-called traders keep changing their mind every other day. It’s hard to trust any of their predictions.
Confidence in the long-term bullish momentum of is key! Let’s hope for a bounce back after this potential dip.