Bitcoin ( BTC ) could still drop below $30,000, but some analysts are already calling for the end of BTC/USD's recent bearish move.
In a tweet on Jan. 25, Mike McGlone, a senior strategist at Bloomberg Intelligence, looked at Bitcoin's position relative to its 20-week moving average and stated that current levels are a historical inflection point.
McGlone: Bitcoin "extended a bit" at all-time highs
McGlone is still hoping Bitcoin weathers a macro storm this year . According to him, BTC/USD is in the same position as it was in March 2020 and July 2021 when the downtrend stopped.
Those timings were the slump due to the Corona virus and the exodus of miners in China.
"The fact that bitcoin is an emerging asset with a market cap of less than $1 trillion (compared to about $100 trillion for global stocks) that was stretched a bit could give the cryptocurrency an edge." he commented.
“Our chart shows a bottom indicator for Bitcoin about 30 percent below its 20-week moving average.”
Nervousness about negative financing rates
However, other people continued to urge caution about the end of the losses.
These include the popular Twitter analyst Material Scientist, who developed the Material Indicators analysis platform.
He examined funding rates, which, while negative, do not necessarily mean that Bitcoin will rise directly.
"I keep seeing people arguing that a negative funding rate is tantamount to bottoming out," he explained .
“Half of CT used this logic and claimed that $40,000 was the bottom. That was not the case. This chart shows the negative funding pairs over time alongside the BTC chart above.”
A chart showing that there were indeed instances in 2021 where the cryptocurrency saw negative funding rates ahead of a further decline.
"Nobody knows when Bitcoin will bottom. Sometimes it's so simple, all you have to do is read the asymmetry of potential downside and upside moves," added William Clemente . He advised investors to take advantage of the cost averaging effect if they want to enter the market in the current range.
“Like I said yesterday, I don't think the asymmetry in BTC around the $30,000 area is pointing down. Possible drop to $20,000, possible rally to $60,000 to use these levels."
BTC/USD is trading around $37,000 at press time and has been holding its gains since the start of the week .
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