The global cryptocurrency market capitalization today stands at $2.36 trillion, down 2.6% over the past 24 hours. Amid these market fluctuations, Bitcoin’s (BTC) recovery attempt has been met with mixed signals from technical indicators, leaving investors worried.
Trading Expert Alan Santana recently projected onto TradeView that Bitcoin is on the verge of a significant decline known as the SD wave or SSD wave.
An SD wave, or super down wave, typically results in a price decline of around 20-30%. In contrast, an SSD wave, or surprise super down wave, suggests a larger decline, potentially exceeding 40% and reaching 50%.
Current chart analysis points to a higher probability of an SSD wave, prompting investors to exercise caution.
The BTC/USD chart shows a noticeable decline in trading volume over the past four months, indicating a weakening of the buying momentum that often precedes a significant decline.
This decline in buying interest at current levels suggests potential for further declines. Therefore, this bearish sentiment and declining volume could lead to a fall in historical support levels, leading to further price declines.
A downward trendline on the chart indicates a continuation of the bearish trend, with the price constantly trying to break above this trendline. Until the price convincingly breaks this resistance, the bearish outlook remains.
Key Levels and Strategies for Overcoming the Decline
The BTC/TUSD chart provides investors with additional context and key levels to monitor.
The March 2024 support range around $57,500 has historically provided strong support and could act as a temporary buffer against a significant decline. However, a break of this level would signal a deeper decline.
Additionally, the predicted level based on altcoin correlations is around $40,000. Given that altcoins often move in tandem with Bitcoin, their current levels suggest that Bitcoin may follow suit.
A drop to this level would mean a serious market decline, which could trigger a further decline in the cryptocurrency market.
Moreover, the January 2024 support level around $35,000 is a critical historical support that could come into play if the market experiences a wave of SSD.
A breakout of this level would signal a long downtrend. Many altcoins that are closely correlated with Bitcoin are already trading at levels seen in January 2024.
Historically, altcoins that move first can predict the direction of the market. Their significant drops suggest that Bitcoin may follow the same downward trajectory. This correlation highlights the need for investors to be vigilant.
Bitcoin Price Analysis
At press time, Bitcoin is trading at $59,780, down 4% on the daily chart and down 12% on the monthly chart. Despite attempts to recover, the market is showing mixed signals.
Current analysis suggests that investors should be prepared for a significant drop in the next few weeks. Key levels to watch include $57,500, $40,000, and $35,000.
Monitoring these levels and market dynamics will be critical to effectively riding out a potential downturn. Investors should stay informed and adjust their strategies accordingly, keeping a close eye on key support levels and market signals to mitigate potential losses.
Denial of responsibility: The content of this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
