Felipe Escudero estimates that the price of Bitcoin could fall by up to 60%, after valuing more than 1,500% since March 2020. Escudero is a trader and host of the BitNada channel.
As noted by a transmission made on Tuesday (18), all the strong price movements of BTC are followed by sharp corrections of up to 60%. It can happen now or later, but history inevitably proves that this correction will happen.
Strong movements call for strong corrections
Analyzing the Bitcoin price chart, Escudero pointed out that the cryptocurrency came out of around $ 3,500 in March 2020 (beginning of the pandemic) and skyrocketed to more than $ 65,000 in April. That is, in the period, Bitcoin appreciated more than 1,700%.
At the moment, looking at Fibonacci’s “magic numbers”, Escudero indicates that a 60% drop cannot be disregarded.
“Now, either we will correct between 50% and 60% – what experienced traders would say is the healthiest – or this correction will remain pending and we will go up again.”
Also according to the trader, in stronger price movements such as the current movement of BTC, it is common for corrections to be more “choppy”.
However, Escudero argues that investors should not be mistaken, as a 60% drop will happen at some point.
“I am not saying it will be today. But at some point it will happen, because that is the natural course of investment. ”
Bitcoin was below the 21-week average
Another cause for concern, according to Escudero, has to do with Bitcoin’s price being below the 21-week moving average. It is the first time that this has happened for over a year, last occurring on April 27, 2020.
Since then, the price of Bitcoin has remained above average, staying even 113% above it in October 2020.
When BTC went over $ 60,000, it was understood that the price was “expensive”. Gradually, the price declined towards the average, until it was below it this week.
For Escudero, the fact that the BTC is below the 21-week average may indicate a trend reversal.
In this regard, the analyst pointed out that it is important to observe whether BTC will be able to remain above the US $ 42,000 – current price support.
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