The leading cryptocurrency, Bitcoin, has exhibited volatile movements over the past week, with downward pressure dominating the picture.
Bitcoin faced renewed selling pressure as US data exceeded expectations and expectations of interest rate hikes rose, falling below $80,000 and testing short-term lows.
While BTC has been trading around $82,000 in recent days, the $82,500 level is seen as a critical threshold in the market. Failure to permanently regain this level increases the risk of continued selling pressure, and a break below this support could bring $80,000 and lower levels into play.
Critical Support at $82,500!
As uncertainty persists for Bitcoin, cryptocurrency market maker Wintermute noted in his latest assessment that Bitcoin losing support at the $82,500 level could increase downside risks.
At this point, Wintermute, in his assessment from account X, stated that if BTC falls below the $82,500 support level, it could decline to around $70,000.
Wintermute noted that BTC has been trading around $82,500 for over three weeks and that a break above $87,000 could trigger a broader uptrend. The company also added that the FOMC meeting could act as a catalyst for a breakout from the current range.
At this point, Wintermute stated that a hawkish stance from the Fed would put downward pressure on BTC, while a dovish stance and stronger-than-expected third-quarter corporate earnings could give momentum to a BTC rally.
The company also added that while predicting the direction is difficult, the current narrow trading range is unlikely to last long.
“After trading around it for more than three weeks, Bitcoin is defending the $82,500 level, which acted as resistance during the rally and now appears to be acting as support.”
The Fed meeting, midterm elections, and third-quarter earnings reports will be released in the next few weeks. Given these developments, we don’t expect BTC to continue trading in this range.
“A break above $87,000 would signal an upward reversal, while a complete loss below $82,500 would turn the support level back into resistance, bringing the $70,000 mark into play.”
Wintermute also noted the recent widespread sell-off in altcoins and the shift of capital towards Bitcoin and Ethereum. The company believes that BTC and ETH offer a more favorable risk-reward profile compared to altcoins.
Bitcoin at a Critical Point!
In line with Wintermute, popular analyst Michaël van de Poppe also suggested $75,000 as a target for BTC.
Poppe identified $80,000 as a crucial support level for Bitcoin, stating that a drop below this level could quickly lead to a decline in BTC to $75,000.
Poppe added that the current correction in Bitcoin is not a major cause for concern. The analyst believes that selling pressure could sharply increase if BTC falls below the key support level of $80,000, but a hold above $80,000 followed by a break above the $83,000 resistance could allow the uptrend to continue for much of the fourth quarter.
