Benzinga - In the wake of the recent cryptocurrency market downturn, Glassnode co-founders Jan Happel and Yann Allemann, operating under the Negentropic handle on X, shed light this week on potential short-term scenarios for Bitcoin (CRYPTO: BTC).
Their analysis suggested that the leading cryptocurrency could be nearing its bottom.
According to the co-founders, there are two possible short-term outcomes for Bitcoin:
The duo emphasized that, based on historical data, Bitcoin will find its bottom shortly after either of these scenarios have played out, especially when the Bitcoin Risk Signal has reached a value of 100.
Meanwhile, pseudonymous crypto strategist Rekt Capital highlighted the distinct patterns observed in Bitcoin's recent price movements.
He pointed out that it took Bitcoin 91 days to form the first half of its double top pattern, while the second half took only 63 days.
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The accelerated decline indicates a shift in market dynamics, according to the analyst.
Rekt Capital further elaborated on the nature of the declines, noting that the initial drop, represented by a green box in his analysis, was methodical, with Bitcoin respecting support levels before eventually breaking them.
In stark contrast, the recent crash, marked by an orange box, saw Bitcoin plummeting without any significant reaction to established support levels, he noted.
The strategist emphasized the lack of buy-side pressure in the recent crash, suggesting that buyers are either not ready or not strong enough to influence the current price trajectory. Furthermore, he warned that the current trading volumes indicate that selling pressure may not have peaked, hinting at the possibility of further declines.
The broader crypto market has witnessed a sharp decline over the last couple of days, apparently over the Fed's signal of a rate hike, with the top 10 cryptocurrencies clocking in double-digit losses.
Major cryptocurrencies like Ripple (CRYPTO: XRP), Solana (CRYPTO: SOL), Dogecoin (CRYPTO: DOGE) and Shiba Inu (CRYPTO: SHIB) are trading down 18%, 12, 18 and 23% respectively over the last seven days.
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