While Bitcoin BTC/USD prices spiral downwards to below $40,000, some technical analyst suggest this drop is temporary before an upward trend resumes.
What Happened: Plunging over 10% from recent highs near 48,000, Bitcoin traded below $39,000 yesterday and continues to struggle to maintain the $40,000 level.
However, traders cite technical factors indicating an impending rebound. Cryptocurrency analyst Ali Charts terms the pullback the "Sentiment Cycle" - a brief anxiety phase marked by correction after transitioning through optimism to belief:
#Bitcoin Sentiment Cycle: Historically, after transitioning from capitulation to hope, optimism, and finally to belief, #BTC has often experienced a brief phase of anxiety, marked by a price correction.
— Ali (@ali_charts) January 23, 2024
This pattern appears to be repeating itself, as we're currently witnessing a… pic.twitter.com/dBwX57D6cP
Another analyst, CryptoDonAlt, called the current chart "beautiful and bullish," believing $32k would be an "absolute gift."
On similar lines, another X user CryptoDonAlt analyzed Bitcoin prices technically and said that, “This is a beautiful and bullish chart.”
At the end of the day
— DonAlt (@CryptoDonAlt) January 23, 2024
This is a beautiful and bullish chart, even if we should retest $32k (32k being an absolute gift to get, not sure the gods will be that kind)
Can't lose sight of the price and the price is much higher prices as long as we don't get a trad market collapse pic.twitter.com/bMARbcBDHD
Crypto/equity options trader Shardi B Trading looked at technicals stating, "This looks like it's going lower though."
Why It Matters: Spot Bitcoin ETFs have seen a total of $1.1 billion in net inflows after two weeks. While some like Jim Cramer think it is unlikely Bitcoin finds footing at $40,000, ARK Invest CEO Cathie Wood maintains a bullish long-term outlook, tweeting of Bitcoin's potential to reach $1.5 million backed by vast computing power.
Analyst opinions vary on the near-term, but technical analysts point to short-lived nature of the pullback in light of the upcoming Bitcoin halving.
Read Next: Bitcoin Experts Say Price Plunge To $39,000 Is 'Healthy For The Market': Here's Why
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