Bitcoin Faces 4% Drop Risk as Key Support Level Looms

Cryptocurrency analyst and trader Justin Bennett has issued a warning that Bitcoin (BTC) is at risk of a significant correction if a crucial support level fails to hold. In a recent strategy session, Bennett shared his insights with 63,300 subscribers of the Daily Price Action YouTube channel, highlighting the potential for a bearish reversal in Bitcoin's price.

Bennett identified $106,000 as the key support level to monitor for Bitcoin. He outlined several potential targets in the event that this support level is breached. The first target, according to Bennett, would be around $101,000, followed by a second target at approximately $97,000, and a third target at around $92,000. He emphasized the importance of observing these levels in a sequential order, suggesting that a sustained break below $106,000 could lead to a cascade of declines.

Bennett also discussed the conditions under which Bitcoin's outlook could turn bullish. He noted that if the market rallies from the current levels around $106,500 and surpasses $109,000, it could invalidate the idea of a breakdown. Additionally, if Bitcoin reclaims the $110,000 level on the daily chart, it would further support a bullish outlook, invalidating the potential for a lower move.

At the time of writing, Bitcoin is trading at $107,560, which is approximately 4% below its all-time high of slightly under $112,000. Bennett's analysis provides a cautious perspective on Bitcoin's near-term prospects, highlighting the importance of key support and resistance levels in determining the cryptocurrency's future price movements.