An analyst who correctly labeled the May 2021 Bitcoin crash is now revealing his worst-case scenario for BTC.
The analyst, nicknamed Dave the Wave, told his 90,000 Twitter followers that Bitcoin has lost a key support level at $40,000 and faces more downside risks.
According to him, bitcoin could drop towards the $30,000 support or $25,000 in a more bearish scenario.
“OH. The problem is that if BTC loses that $40,000 zone, there won’t be much support below it…
But the support remains.
The best case is an adjustment to $30,000. The worst case scenario is $25,000.
Prices remain bullish over the long term.”
BTC/USDT daily chart | The source: Dave the Wave/Twitter
Dave the Wave uses a Fibonacci extension and points to a favorable head and shoulders pattern to identify a $25,000 downside price target for BTC.
“For those wondering about the Fib extension here, it measures a potential target of a head and shoulder pattern.”
BTC/USDT daily chart | The source: Dave the Wave/Twitter
The analyst added that the benchmark cryptocurrency must first decisively break the descending resistance line ($41,000) for Bitcoin to generate bullish momentum.
“Think it’s that simple.
BTC needs to make a higher low and break the resistance line before thinking of a trend reversal.”
BTC/USDT daily chart | The source: Dave the Wave/Twitter
At the time of writing, Bitcoin is trading at $35,401, down almost 50% from its all-time high of $69,000.
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