There’s no denying that Bitcoin has significantly underperformed in recent months and has fallen short of the high expectations held by many bullish market participants. This underperformance has been especially evident in the past few weeks, where the cryptocurrency has faced considerable declines. Bitcoin’s price has dropped by 8.2% over the last seven days and 5.4% in the past 20 days, pushing more short-term holders into losses.
A well-known crypto analyst, Caleb Franzen, recently weighed in on the situation through a post on the social media platform X (formerly Twitter). According to Franzen, Bitcoin’s underwhelming performance has now positioned the cryptocurrency at a crucial position that would determine a bull market continuation.
Bitcoin At A Critical Juncture
“This is the moment for Bitcoin,” Caleb Franzen noted. This statement was made as part of a post in which the analyst noted how Bitcoin’s bullish structure seems to be breaking down. Known for his historically bullish stance on Bitcoin, Franzen has consistently predicted upward trends for the cryptocurrency.
However, his latest remarks signal a shift in his outlook as he begins to reassess his last bullish prediction in light of current market conditions.
Interestingly, he backed up his decision to temper his optimism by highlighting various trading indicators that have now turned negative for Bitcoin. Among these, he highlighted the Williams %R, a momentum indicator, which has failed to show any bullish momentum over the past 60 days.
Furthermore, he pointed to the lack of overbought signals, the negative slopes of critical moving averages like the 21, 55, and 200 EMAs, and a noticeable decline in risk appetite among investors.
Franzen emphasized that these indicators should be viewed objectively. Hence, their current state suggests that it’s time to acknowledge the present reality of Bitcoin’s price struggle. Despite this, Franzen remains cautiously optimistic about Bitcoin’s long-term potential.
However, he acknowledged that his expectations for a bull market continuation pushing Bitcoin above $90,000, which he had held for the past six months, may have been overly optimistic. He also goes ahead to recap how his overly optimistic stance on Bitcoin has brought him tremendous criticism over the years.
This is the moment for #Bitcoin.
A daily close below $54k would represent yet another lower low after a series of lower highs.
We’re below the 21, 55, 100 and 200-day MA.
We’re below the short-term holder realized price.
We’re losing bullish structure.
These are just facts.… pic.twitter.com/A3xE7IwkLe
— Caleb Franzen (@CalebFranzen) September 6, 2024
What Does This Mean For Bitcoin?
According to Frazer, a daily close below $54,000 would represent yet another lower low after a series of lower highs. This could lead to a further decline in the price of Bitcoin for the rest of the weekend. Interestingly, this aligns with a recent price outlook by Arthur Hayes, who expects a break below $50,000 this weekend. Hayes is the co-founder of crypto exchange BitMEX.
As of the time of writing, Bitcoin is trading at $54,280, hovering close to a pivotal support at $54,000. Should the price drop below $54,000, it could confirm a deeper bearish trend.
Featured image from MarketWatch, chart from TradingView
Bitcoinist.comRead More
