Bitcoin Weekly Close Approaches as Price Drops Below $66,000: Is a 45% Crash Possible?

As Bitcoin (BTC) continues its downward trend, recent price drops have raised alarms about the potential future of one of the most popular cryptocurrencies. Analysts are warning that Bitcoin's upcoming closes could indicate the beginning of a significant correction.

Key Takeaways:

Bitcoin has dropped over 7%, reaching a three-week low of $65,700.
Analysts warn of a potential 30%-45% further decline due to bearish patterns and historical trends.
The cryptocurrency has fallen below the critical 200-week EMA, which could pose challenges for its recovery.
Market observers remain cautious as Bitcoin approaches significant weekly closures that could dictate its short-term future.

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Bitcoin Faces Possibility of a Major Decline

On Friday, Bitcoin experienced a steep drop of over 7%, hitting a three-week low of $65,700. This has sparked concerns regarding the short- to mid-term performance of the leading cryptocurrency. Since the crash in early February, Bitcoin has fluctuated between the $65,000 and $72,000 ranges.

Analyst Altcoin Sherpa emphasized the importance of maintaining current price levels. A loss of this support could lead to a rapid decline of 6% to 10%, bringing Bitcoin’s price down to the next support zone around $60,000 to $62,000.

Bitcoin BTC is at risk of an initial drop to $62,000. Source: Altcoin Sherpa on X

Market analysts have also indicated that Bitcoin is breaking down from a critical bearish pattern, which could result in a significant decline to new lows if it doesn't rebound soon. Notably, Bitcoin has been forming a bear flag pattern on the daily chart for nearly two months, frequently testing the lower boundary. Current signs indicate that BTC may soon lose this support level.

Ted Pillows noted on X that Bitcoin is not only falling in price but also losing upward momentum as it has broken its RSI uptrend. He called this “a major sign of weakness,” emphasizing that a breakdown is inevitable. Pillows warned that Bitcoin has already deviated from a similar bear flag pattern that began at the start of this year.

Additionally, Ali Martinez suggested that Bitcoin could plummet an additional 30% to 45% based on its historical trends. He explained that Bitcoin has previously initiated new bull runs after dipping below its long-term holder realized price and lower standard deviation bands, specifically at $48,387 and $36,657 levels.

“I’ll be keeping an eye on these areas for potential dip-buying opportunities before the next bull cycle,” he noted.

Focus Shifts to Bitcoin’s Weekly Close

Analyst Rekt Capital pointed out another alarming signal for Bitcoin, indicating that the cryptocurrency has once again dropped below the 200-week Exponential Moving Average (EMA). This decline has caused the cryptocurrency to treat this EMA as a new resistance level, putting emphasis on the forthcoming weekly close.

He previously stated, “If the 200-week EMA is lost as support this week and the weekly close is below it again, Bitcoin could potentially turn the EMA into new resistance.”

Last week, Bitcoin technically closed below the 200-week EMA after an attempt to retest it as support but ultimately failed to maintain above the $68,000 mark. “This suggests that the price has initiated a breakdown from the EMA,” and a close below this level would confirm that trend.

“Given this last weekly close, there is potential for another dip to the 200-week EMA for a retest to assess whether BTC can reclaim this level as support,” he explained. However, he added that the general trend indicates that the 200-week EMA is acting as both an unreliable resistance and support level, without confirming a clear trajectory.

The uncertainty surrounding Bitcoin's price could lead to repeated tests of this area before eventually resulting in additional macro declines over time.

At the time of this writing, Bitcoin is trading at $65,600, reflecting a 6% decrease over the week.

bitcoin, btc, btcusdt Bitcoin’s performance in the one-week chart. Source: BTCUSDT on TradingView