With Bitcoin BTC/USD down 11% over the past week, a 10x Research report advises caution considering the sell-off ahead of the Bitcoin halving.
What Happened: According to the report, Bitcoin is at a critical juncture. The recent drop, which occurred within a narrowing symmetrical triangle, suggests that whichever side the price levels break could lead to a quick +/-10% follow-through.
Bitcoin’s first critical stop level sits at around $60,026, while the next would be $51,536. 10x Research had predicted two months ago, when Bitcoin traded at $52,000, that it would peak at $68,000 a few days ahead of the Halving.
The report states that when Bitcoin prices close lower than its monthly upper Bollinger level ($68,695), the upside momentum might also be at risk during parabolic rallies.
It draws parallels to past performance, noting that when Bitcoin traded below its upper monthly Bollinger band in April/May 2021, it corrected from $60,000 to the low $30,000 rather quickly.
![Benzinga Future of Digital Assets conference](https://editorial-assets.benzinga.com/wp-content/uploads/2024/03/29155259/905735A6-57D3-4874-9AA1-75D037842DB3-2.gif)
10x Research suggests setting a stop loss level at 62,500 when 61,000 gets tested. A break below this level could see the market correcting materially lower.
They also adopt a cautious stance on the post-Halving period, highlighting the lack of historical evidence to support immediate bullishness. While crypto has become a legitimate asset class, deep and prolonged corrections can still occur. Some people claim that there would be a pre-Halving sell-off, but there is no data supporting this, and many traders are nervous that it could occur.
Bitcoin miners could potentially sell $5 billion of Bitcoin inventories after the Halving, which could adversely affect altcoins. This caution was validated as many popular altcoins experienced significant declines over the last weekend.
What's Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga's upcoming Future of Digital Assets event on Nov. 19.
Read Next: Peter Schiff Predicts Bitcoin ETFs Will Lead To Its ‘Biggest Crash Ever’
Image: Pixabay
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.