The marketโs New Year rebound turned into a start-of-year retrace after Bitcoin (BTC) dropped from the recently reclaimed $100,000 support into the $94,000 territory. Amid the drop, an analyst shared his โcautiously bullishโ outlook for BTCโs price.
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Bitcoin Risks Crash To $74,000
On Tuesday, Bitcoin dropped below $97,000, dragging the market into the first pullback of the year. BTC began 2025 trading around the $92,000 level but climbed around 6.5% in the following days.
After turning the $98,000 resistance into support over the weekend, Bitcoin jumped back above $100,000, reaching its highest price in weeks. However, BTC struggled to maintain this key support zone, dipping 3% in an hour yesterday.
The cryptocurrency has dropped another 2.5% in the past day, falling as low as $94,500 on Wednesday morning. Since then, BTC has hovered between $94,800 and $95,600, briefly testing the $96,000 resistance.
Crypto analyst Ali Martinez examined BTCโs recent performance. In an X threat, the analyst noted that Bitcoin had โbreached the right shoulder of a head-and-shoulders patternโ on Monday, invalidating the bearish setup pattern.
However, the reversal โerased those gains, dragging BTC back below the right shoulder and reigniting bearish concerns,โ as this pattern could trigger a correction to at least $78,000. Martinez also pointed out that Bitcoin has fallen below a key demand zone, between $95,400 and $98,400, where 1.77 million addresses acquired over 1.53 million BTC.
The analyst suggested the price drop could force these holders to โsell some BTC to cut potential losses.โ He also noted there isnโt significant resistance ahead for the flagship crypto, with only a minimal supply wall of 107,000 BTC between $104,700 and $105,770.
Nonetheless, the analyst warned that a surge in selling pressure that pushes the cryptocurrency below the $92,000 mark โcould spell trouble,โ as it would open โthe door to a steep drop, with little support until $74,000.โ
โTherefore, the current market conditions, from a macro perspective, are reigniting fears of a potential Bitcoin crash,โ he added.
BTC Price Set To Bounce Soon?
The analyst also shared a โcautiously bullishโ outlook for BTC from a technical perspective. Martinez pointed out that TD Sequential presented a buy signal on Bitcoinโs 4-hour chart, suggesting a potential price rebound if the price can hold the $93,500 support zone.
Additionally, he highlighted that traders on Binance โare leaning bullish on Bitcoin,โ as ย 61.28% of all traders on the crypto exchange with open positions are betting that the price will go up.
Martinez also noted that $35 million would be liquidated if BTCโs price rebounds to $98,600, suggesting that market makers โmay try to grabโ it. Similarly, thereโs another $66 million liquidation zone above $103,300.
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However, the analyst emphasized that Bitcoin must reclaim the $100,000 support to invalidate the bearish outlook and โset its sights on new all-time highs.โ Martinez concluded that BTC could rebound to $98,600 in the short term, but โthe macro suggests caution.โ
As of this writing, Bitcoin is trading at $94,500, a 3.3% retrace in the daily timeframe.
Featured Image from Unsplash.com, Chart from TradingView.com
