How Low Can Bitcoin Price Go?

Rekt Capital put the Bitcoin price pullback in a historical perspective, underscoring the historical importance of weeks 6, 7, and 8 in a “price discovery uptrend.�Drawing upon past cycles such as 2013, 2016�017, and 2021, he explained that Bitcoin has a strong tendency to correct during these specific windows, with some dips reaching as steep as 34% or even higher.

“Understanding these weeks is crucial because they tend to be problematic for Bitcoin,�Rekt Capital stated, referencing past cycles where significant downturns occurred within this timeframe. For instance, in week 7 of the 2013 cycle, Bitcoin experienced a dramatic 75% pullback over 13 weeks. Similarly, the 2016-2017 period saw a 34% decline in week 8, underscoring the recurring vulnerability during these specific weeks.

As of the current cycle, Bitcoin has undergone a 10%+ retracement, bringing its price into a historically critical support zone at $96,537 on the weekly chart. Rekt Capital emphasized the importance of this support level, noting, “This area of historical support has enabled the move to $108,000.�He cautioned that failure to maintain this support could trigger a more severe correction down to $89,830.

Examining the price action of the last few days, Rekt Capital pointed out the emergence of a bearish engulfing candle in the weekly timeframe—a technical indicator often associated with potential reversals. “We’re losing resistances that turned into support,�he observed. This loss signifies a potential transition into a corrective period, as the price struggles to maintain its upward trajectory.

Rekt Capital also pointed out the importance of maintaining the 5-week technical line in his analysis. “If we lose this 5-week technical uptrend and the orange trend line, it would be mounting evidence that we might be transitioning into a corrective period,�he warned.

Furthermore, he addressed the CME gap between the $78,000 and $80,000 price levels, a critical area that has remained unfilled. “Delving into 26%, 27%, 28% dips could fill the entire CME gap,�Rekt Capital noted.

Historically, CME gaps have the tendency to get filled whereas there are a few ones which have never been filled. Despite all cautionary signals, Rekt Capital maintains a bullish stance in the long-term “These pullbacks are what enable future uptrends in the parabolic phase of the cycle,â€?he explained. Drawing from previous cycles, he illustrated how corrections have historically provided the necessary “breather” for the market.

In the 2021 cycle, for example, Bitcoin experienced a 16% pullback in week 6 and an 8% dip in week 8, yet the overall trend continued upward. Similarly, the current 10% retracement, while significant, could serve as a preparatory phase for the next leg of price discovery.

At press time, BTC traded at $95,000.