Trader explains 3 scenarios for bitcoin price after falling to $21,000

Key facts:
  • Bitcoin could revisit the $19,000 zone after this new drop.

  • Now, the cryptocurrency has once again lost important historical support.

While most expected a new price rise, bitcoin gave a new surprise to traders in the market. The cryptocurrency went from trying to consolidate above $24,000 to revisiting the $21,000 zone. This leads everyone to ask themselves again: what now?

Analyst Daniel Ferraro made an analysis of the possibilities for the price of bitcoin after that fall. The results are laid out in trader Scott Melker’s latest newsletter, published this Friday.

to ferraro, there are three key prices to watch right now: the 23,000 dollars as resistance, after having become a buying zone of about 828,000 bitcoins in total; $21,000 as possible support; and $19,000 as a possible area to revisit if it fails to sustain strongly at current price levels.

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The $23,000 is particularly important, as at that mark is the 200-week moving average. That average has historically been important as a support for the price of the cryptocurrency and its recent recovery seemed to point to a new rise, which has failed for the time being.

Bitcoin price.
BTC is back below the 200-week moving average. Source: TradingView.

Another key is $25,000, which right now has proven to put up a firm resistance for the cryptocurrency.. Since last June 13, when bitcoin fell from $26,500 to $22,400, the market has repeatedly tried to break above $25,000 again. But without success.

The analyst noted that bitcoin’s price action remains “uncertain,” so it’s no surprise how much money traders lost in the wake of Friday’s price drop. As we reported in CriptoNoticias, it was the highest liquidation volume in a 24-hour range for leveraged traders since last June.

Accumulation of bitcoins signals its upside potential

Ferraro pointed out a possible bullish scenario, in view of the behavior of investors’ accumulation of BTC. As he pointed out in his analysis, the percentage of bitcoins that have not moved between addresses for more than a year is close to its all-time high, from May 2021. Right now, 65.5% of bitcoins on the network are kept for more than a year. Meaning, people are saving BTC at historic levels in the midst of this bear market.

This could potentially lead to a top formation and also indicates how buyers following the great mining migration and early 2022 buyers have refused to sell at the lows..

Daniel Ferraro, market analyst.

In recent days, bitcoin showed weakness in the market. First, he failed to hold onto $24,000. Then, with the drop to 21,000, the outlook seems to worsen and there are those who expect high volatility to return to the cryptocurrency market.

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