Bitcoin's 3 Price Action Scenarios: Below A Certain Price It's Time To Get 'Cautious,' Research Shows

10x Research analyzed the recent Bitcoin BTC/USD liquidation crash following the new all-time high. 

The digital asset research firm expected a crash only next week, based on Bitcoin following the same pattern as it did during a rally in the fall of 2017.

However, with the highest returns near intermediate tops, traders likely leveraged gains. The sell-off saw prices decline once market open orders cleared after 30 minutes, lasting until an hour before close, indicating institutional selling.

The report expects the bull market to continue. However, prices may trade sideways for one to two weeks after yesterday's downward move.

Notably, Bitcoin spot ETF flows remained strong amid the price drop. The report notes ETFs "bought the dip and registered a net inflow of [more than] $662 million."

The firm's model, which was incorrect only twice previously, currently shows a "high volatility signal."

Read More: Record $648M Inflows To Bitcoin ETFs Coincide With All-Time Highs

The report analyzes eight similar Bitcoin setups (rally, consolidation, rally within 50 days) in the past decade.

"When Bitcoin was above its 100-day moving average — as now — then after ten days' consolidation, prices resumed uptrends, with Bitcoin higher in 6 of 7 events — two, three, and four months later."

10x Research provides three potential situations based on price action:

1. Bitcoin surging above 64,000 could spark another new high.
2. Bitcoin falling below 62,000 warrants neutrality.
3. Between 62,000-64,000 requires careful risk management.

Conclusion: 10x Research remains bullish and expects higher prices. However, peaking then selling off would be bearish. "Tonight's price action will be crucial," they state.

Read Next: How To Buy Bitcoin As It Makes History - Step-By-Step Guide To Purchase Your First Crypto Safely

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