Bitcoin Drops 11.3% as Key Indicators Signal Potential Reversal

Bitcoin (BTC) has experienced a significant decline, dropping 11.3% over the past week and currently trading in the low $80,000 range. This recent downturn has pushed the leading cryptocurrency below its 200-day moving average (MA), a key technical indicator that has historically served as a strong support level. The 200-day MA represents the average closing price of BTC over the last 200 days, and sustained movement above this level has typically led to long-term uptrends, while prolonged movement below it has often preceded further declines.

Crypto analyst Ali Martinez highlighted the importance of BTC remaining above the TD Sequential indicator’s risk line at $79,280. He noted that a sustained move above this level could set the stage for a strong rebound. Martinez also outlined BTC’s potential path to a new all-time high (ATH), emphasizing that the digital asset must first reclaim $84,000 as a support level before any major upside movement. Once this milestone is secured, BTC could rally toward $128,000.

Several indicators suggest that BTC may have already found a local bottom, increasing the chances of a trend reversal. Crypto analyst Rekt Capital recently noted that BTC’s plunge to $78,258 could mark the cycle low. Additionally, the US Dollar Index (DXY) has just recorded one of its largest weekly breakdowns since 2013, a move that historically signals bullish momentum for risk-on assets like BTC.

Fellow crypto analyst Ted echoed the potential for a BTC recovery, pointing out that over the past two years, BTC has frequently undergone 25% to 30% corrections before rebounding to new ATHs. Ted noted that in 2023, BTC went from $30,000 to $22,000, and in 2024, it went from $74,000 to $50,000. This year, BTC has dropped from $109,000 to $79,000. If BTC follows a similar pattern and climbs 30% from its current price, it could reach approximately $104,000 in a short period. However, broader macroeconomic factors