Bitcoin (BTC) is currently facing a potential drop to levels not seen since early May, according to a well-known crypto trader operating under the pseudonym DonAlt. In a recent update shared with the 66,500 subscribers of the TechnicalRoundup YouTube channel, DonAlt expressed a bearish outlook for the leading cryptocurrency based on his analysis of Bitcoin’s daily time frame.
The trader highlighted a crucial support level, which has been holding firm since Bitcoin surged to a new all-time high of nearly $112,000. Should this support level fail to sustain, DonAlt believes that Bitcoin could experience a significant decline of up to 15% from its current price, potentially dropping back to the $90,000 range.
Describing Bitcoin’s recent rally to an all-time high as a “false breakout” on the daily time frame, DonAlt pointed out that successful breakouts typically do not retest previous support levels. The fact that Bitcoin is revisiting these levels indicates a lack of momentum and urgency in the market, according to the trader.
However, despite the bearish signals on the daily chart, DonAlt noted that Bitcoin appears more bullish on higher time frames such as the weekly and monthly charts. While the weekly outlook is slightly less bullish than the monthly one, both time frames suggest a positive trend for the cryptocurrency.
At the time of writing, Bitcoin is trading at $105,713, with the market awaiting further developments to determine its next move. It is essential for traders and investors to closely monitor the support level mentioned by DonAlt to gauge Bitcoin’s potential price direction in the coming days.
In conclusion, while Bitcoin may face short-term challenges based on the daily chart analysis, the overall sentiment remains positive on higher time frames. Traders should exercise caution and stay informed about market developments to make well-informed decisions regarding their Bitcoin investments.
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