According to Katie Stockton, founder of Fairlead Strategies, after Bitcoin briefly broke through the significant psychological level of $100,000, this cryptocurrency may face corrective selling in the short term.
In a report released on Monday, Stockton noted that Bitcoin's failure to maintain above $100,000 for more than a few days meant that the historic breakout 'was not confirmed,' opening up a potential weak scenario for Bitcoin in the short term.
Stockton stated: 'Short-term bullish momentum is weak, and a new daily-level anti-trend signal supports Bitcoin consolidating in the coming weeks before continuing its upward trend.'
The anti-trend 'sell' signal that Stockton is concerned about suggests that Bitcoin's consolidation period will last at least another two weeks. Stockton stated that two support levels investors should focus on include the 20-day moving average of $97,233 as of Tuesday morning and the 50-day moving average of $85,342.
This means Bitcoin has the potential for about a 13% downside. If the 50-day moving average is also broken, Stockton pointed out that $73,800 could be the next level Bitcoin might reach, representing about a 24% potential downside.
Stockton commented on the lower support level: 'But this level is unlikely to be significant in the short term.'
On Tuesday, Bitcoin also faced negative news. Microsoft's major shareholders opposed the company's Bitcoin investment proposal on Tuesday. Earlier, the Microsoft board had urged shareholders to reject a recommendation from the National Center for Public Policy Research to invest 1% of the company's total assets in Bitcoin to hedge against inflation. At the annual meeting, MicroStrategy Chairman Michael Saylor gave a three-minute speech attempting to persuade Microsoft shareholders to support the proposal. MicroStrategy has invested billions of dollars in Bitcoin.
Although Bitcoin briefly fell below $100,000 in the short term, Stockton indicated that Bitcoin still has bullish momentum in the medium to long term.
This indicates that any price correction action should ultimately be brief, and as time moves into 2025, the long-term upward trend of cryptocurrencies will continue.
Stockton said: 'Our mid-term indicators show that Bitcoin will move to higher price levels, supporting its bullish outlook after short-term consolidation. This suggests that a severe pullback can be avoided. Our long-term indicators rose last month, supporting the bullish outlook for 2025.'
