{"id":433,"date":"2022-05-10T04:19:20","date_gmt":"2022-05-10T04:19:20","guid":{"rendered":"https:\/\/cryptoteambuild.com\/blog\/bitcoin-how-btcs-recent-crash-has-aggravated-its-chances-of-touching-20k\/"},"modified":"2022-05-10T04:19:20","modified_gmt":"2022-05-10T04:19:20","slug":"bitcoin-how-btcs-recent-crash-has-aggravated-its-chances-of-touching-20k","status":"publish","type":"post","link":"https:\/\/cryptoteambuild.com\/blog\/bitcoin-how-btcs-recent-crash-has-aggravated-its-chances-of-touching-20k\/","title":{"rendered":"Bitcoin: How BTC\u2019s recent crash has aggravated its chances of touching $20k"},"content":{"rendered":"
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Bitcoin price has continued its descent after breaching an extremely bearish continuation pattern. The recent sell-off seems to be happening after the FOMC meeting and suggests that is mainly driven by long-term holders that purchased BTC in 2021 and 2022.<\/p>\n

Bitcoin price in search of stable footing<\/h3>\n

Bitcoin price has created a bearish continuation pattern referred to as a bear flag. The pattern contains a massive downswing followed by a consolidation phase. A breakout from this coiling-up often results in the price continuing its descent.<\/p>\n

For Bitcoin, the 52% crash from its all-time high at $69,000 to $32,837 created the flag pole. The stagnation period where BTC formed a series of higher highs and higher lows in the form of an ascending parallel channel set up a flag.<\/p>\n

The target for this technical formation is determined by adding the flagpole’s height to the breakout point. On 22 April, BTC breached the flag’s lower trend line at $40,032, forecasting a target of $21,584.<\/p>\n

The post-FOMC crash has also breached below a significant support level at $36,271, suggesting that the bears are in control. This level has also been invalidated on a weekly time frame as well, adding credence to the incoming downswing.<\/p>\n

Therefore, investors need to be prepared for a crash to the $30,000 psychological level. Due to the triple top setup formed during May and July 2021, there is a chance for market makers to dip below $29,000 to collect the sell-stops.<\/p>\n

If the sellers continue to dominate, BTC could easily reach its target of $21,584 from $29,000.<\/p>\n

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BTC Perpetual Futures | Source: Tradingview<\/p>\n<\/div>\n

Making sense of this bearish outlook for Bitcoin price is the 365-day Market Value to Realized Value (MVRV) model. As mentioned previously, this indicator is used to track the average profit\/loss of investors that purchased BTC over the past year.<\/p>\n

Generally, a negative value reveals that these holders are underwater and a positive value indicates that holders are in profit. The probability of a sell-off is high in the latter condition, so ideally, investors do not buy or accumulate when MVRV is positive.<\/p>\n

Based on Santiment’s backtests, a value between -10% to -15% is the best place to accumulate since it indicates that short-term holders are at a loss and are less likely to sell at a loss. However, for long-term holders, it is a great place to accumulate which is why the aforementioned range is termed an “opportunity zone.”<\/p>\n

Currently, the 365-day MVRV is hovering around a local support level of -25%. Historically, the data shows that this number could drop up to -40%, which is where March 2020 crash bottom was formed.<\/p>\n

Therefore, investors need to be aware of the chances of a steep correction, which alights with the bearish technical perspective.<\/p>\n

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30-day MVRV Ratio | Source: Santiment<\/p>\n<\/div><\/div>\n

Read More<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Bitcoin price has continued its descent after breaching an extremely bearish continuation pattern. The recent sell-off seems to be happening after the FOMC meeting and suggests that is mainly driven by long-term holders that purchased BTC in 2021 and 2022. Bitcoin price in search of stable footing Bitcoin price has created a bearish continuation pattern referred to as a bear flag. The pattern contains a massive downswing followed by a consolidation phase. A breakout from this coiling-up often results in the price continuing its descent. For Bitcoin, the 52% crash from its all-time high at $69,000 to $32,837 created the […]<\/p>\n","protected":false},"author":1,"featured_media":434,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[6],"tags":[18,166],"_links":{"self":[{"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/posts\/433"}],"collection":[{"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/comments?post=433"}],"version-history":[{"count":0,"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/posts\/433\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/media\/434"}],"wp:attachment":[{"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/media?parent=433"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/categories?post=433"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cryptoteambuild.com\/blog\/wp-json\/wp\/v2\/tags?post=433"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}