Bitcoin (BTC) faces a battle to preserve its bull market as Mt. Gox reimbursements spark the biggest liquidation cascade in years.
BTC price supertrend support nears first test since 2022
BTC price downside hit 5% on July 5 alone, per data from Cointelegraph Markets Pro and TradingView — and now traders are eyeing lines in the sand which bulls must protect.
For popular trader Matthew Hyland, first on the radar is support at the $52,000 mark.
This forms the floor of Bitcoin’s Supertrend Indicator on weekly timeframes — a foundation for price in place since mid-March’s $73,800 all-time high.
Supertrend employs average true range to create a “Supertend line,” which delineates buy and sell phases for BTC/USD. The pair has been above the Supertrend line since the end of 2022, when Bitcoin’s last bear market ended.
Observing prior Bitcoin bull markets, the current drawdown from all-time highs is still modest.
Since 2016, BTC/USD has dipped 38% on multiple occasions — making the target for the capitulation $45,750.
Commenting on the phenomenon, Adam Back, founder and CEO of Blockstream, criticized fickle market sentiment. Instead, he argued, hodlers should increase exposure to both Bitcoin and the stock of MicroStrategy, the firm with the largest BTC treasury of any public company.
“Reminder, zoom out. prior bull runs had half a dozen -30% draw downs too. we're at about -26% (-27% earlier),” he wrote on X (formerly Twitter).
“In fact if anything, recent draw-downs seem to be less deep, but people forget the normal bull market pattern. Don't panic, buy the dip. or buy a bit of $CMSTR with BTC.”
Analyst: Bitcoin history "repeating as we speak"
Just as unfazed about the extent of the downside is popular trader and analyst Rekt Capital.
Related: Mt. Gox begins repayments in Bitcoin and Bitcoin Cash
“This pullback is -21% deep & 45 days long. In this cycle, average retrace depth is -22% & average retrace duration 42 days,” he calculated.
“In terms of retrace depth, this is almost an average retrace. In terms of retrace duration, this is an above-average pullback.”
Long-term, he added in a further X post alongside a comparative chart, BTC price history is “repeating as we speak.”
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.