Bitcoin is facing a challenging outlook, as its long-term rally is deemed “broken” until it can reclaim the critical price level of $85,000, according to Jean-David Péquignot, the chief commercial officer of derivatives exchange Deribit. Currently, the leading cryptocurrency has been trading within the range of $60,000 to $70,000, reflecting a significant decline of approximately 45% from its all-time high reached in October.
During an interview at the Consensus Hong Kong conference, Péquignot emphasized that the market”s inability to regain the $85,000 mark indicates that the longer-term chart remains compromised, suggesting that the prevailing trend may continue downward. “Until the market reclaims $85k, the longer-term chart remains broken, and the path of least resistance technically remains lower,” he stated.
At the time of writing, Bitcoin is hovering around $66,600, significantly below the pivotal threshold outlined by Péquignot. This places it firmly within bear market territory, suggesting further potential declines could be on the horizon. The next major support level is identified at $60,000, a price point that became relevant earlier this month as Bitcoin”s value dipped alongside broader market movements in technology stocks.
Péquignot pointed out that the $60,000 level serves as a psychological barrier for traders, historically associated with large buy walls or clusters of purchase orders. “If $60k fails to hold on a closing basis, the 200-week moving average is the next logical, and possibly final stop for this correction,” he added.
The 200-week simple moving average (SMA) is often viewed as a critical indicator for traders looking to capitalize on market lows during bear phases. Historically, Bitcoin has touched lows near this average during previous bear markets, making it a focal point for current traders. Presently, this average sits around $58,000, with many experts suggesting that the $58,000 to $60,000 range represents the ultimate support for Bitcoin.
