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Why Bitcoin Could Still Fall Before Rising Again

Thu 28 Nov 2024 ▪ 3 min read ▪ by Fenelon L.
Getting informed Event

As Bitcoin hovers around $95,000, the crypto community is questioning the possibility of a significant correction. Amid mixed technical signals and the historical patterns of Thanksgiving periods, the short-term future of the queen of cryptos remains uncertain.

Americans on Thinksgiving lose bitcoin

Technical signals paint a mixed picture

The Bitcoin is currently in a critical phase after losing support at $95,000 on November 25. This break from a bullish chart pattern has led the crypto to seek refuge on its 100-day exponential moving average.

However, on-chain analysis brings a note of optimism: according to researcher Axel Adler Jr, the low level of “value destruction days” (below 2) indicates that long-term investors are firmly holding their positions, a historically bullish signal.

Analyst Javon Marks projects an ambitious target of $113,386, representing a potential increase of 20.7% from current levels. Conversely, experienced trader Horse identifies a probable retest zone between $82,000 and $88,500, based on volume profile analysis.

The Thanksgiving effect could weigh on Bitcoin’s price

Thanksgiving, this traditional American holiday celebrated on the fourth Thursday of November where families gather around a turkey, historically marks a particular period for financial markets.

Indeed, historical data shows that this day, when traditional American markets are closed, often coincides with a temporary drop in Bitcoin. The most striking example dates back to 2020, when a correction in November preceded a major rally in December.

Charles Edwards from Capriole Fund notes an interesting pattern: while Wednesdays are generally favorable for Bitcoin, Thanksgiving Thursdays have consistently seen drops over the past five years.

The next 24 hours will be crucial: a daily close above $95,000 would confirm a bullish scenario, while a failure to reclaim the 50-day exponential moving average could hasten a test of support around $90,000.

If Bitcoin’s fundamentals remain strong with high retention among historical holders, the Thanksgiving period and current technical resistances pose short-term challenges. The increased volatility expected in the coming days could provide opportunities for both buyers and sellers depending on their investment horizon.

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Fenelon L. avatar
Fenelon L.

Passionné par le Bitcoin, j'aime explorer les méandres de la blockchain et des cryptos et je partage mes découvertes avec la communauté. Mon rêve est de vivre dans un monde où la vie privée et la liberté financière sont garanties pour tous, et je crois fermement que Bitcoin est l'outil qui peut rendre cela possible.

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.