- Bitcoin price could still drop to the 200-MA at $22,000, with possible downside wicks to $19,000 and then $15,500.
- Bounces off these levels have offered huge investment returns for long-term investors, says crypto analyst Rekt Capital.
Bitcoin (BTC) trails further losses below $30,000 as the broader crypto market swings into the red amid further downside for stocks. BTC, which has fallen nearly 58% from its all-time high, could still see further selling to new multi-year lows.
But for investors looking to enter the market, this could come with a massive opportunity if prices ended up at a key historical support level.
Top crypto analyst Rekt Capital says this has been the case whenever the price of BTC reaches or falls below the 200-week moving average (the 200-MA).
“Since 2015, the 200-MA has been touched on 4 occasions to form generational bear market bottoms. And 3 out of 4 of those Bear Market bottoms ended with downside wicking,” Rekt noted in a Twitter thread on Tuesday.
The downside wicks are between -14% and -28%, the latter occurring after the market collapse in March 2020. According to the analyst, the current price of Bitcoin means that the bears must reduce the value of the flagship cryptocurrency by 28% to reach the 200-MA which currently sits at around $22,000.
Below this historical support level, a -14% to -28% return would bring BTC/USD to $19,000 and $15,500.
This means that investors who probably missed the last bull market could have a chance of having a low entry point at these levels.
However, while the analyst says downside wicks off the 200-MA have largely presented periods of “peak financial opportunity for long-term BTC investors,” the market at these times is usually at extreme fear and maximum pessimism.
