Traders utilizing a popular momentum indicator suggest that the price of Bitcoin (BTC) could continue to decline in the near future while still maintaining bullish market momentum.
Bollinger Bands, a technical analysis tool that uses price volatility to identify potential trading opportunities, indicate that traders are looking to buy near the lower band and sell near the upper band.
Based on increased daily volatility within the price range, traders predict further downward movement for Bitcoin.
Pseudonymous crypto trader Aqua, with a following of 16,500 on X, stated in an April 17 post that the Bollinger Band squeeze is slowly being released and a close below support could lead to an expansion to the $50,000 range.
Crypto trader Aqua, in a series of posts on April 17, predicted a “continued correction” despite the upcoming Bitcoin halving on April 20. However, they reassured that the market’s long-term bullish momentum remains intact.
Technical analyst Tony Severino suggests that if the market cycle resembles that of 2017, Bitcoin’s price may experience significant volatility. In an April 16 post on X, Severino stated that the worst-case scenario based on Bollinger Band analysis would be $53,000.
Pseudonymous crypto trader Rekt Capital also expressed concerns about Bitcoin’s price in a post on X on the same day. They emphasized the need for Bitcoin to maintain its current support levels to avoid a breakdown similar to the lows of the March 2023 18% pullback.
According to trading resource Material Indicators, strong buy-side support is forming approximately 5% below Bitcoin’s current price of $64,242. Fire Charts indicates that bid liquidity-based support is building in the range of $59,000 to $61,000, with additional support down to $50,000.
If Bitcoin’s price drops to the lower end of that range at $59,000, approximately $2.2 billion worth of long positions will be liquidated, according to CoinGlass data. Conversely, a 1.15% increase in Bitcoin’s price to $65,000 would result in the liquidation of $551 million in short positions.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and analysis before making any investment decisions.