Bitcoin has seen a steep decline of over 6% in the past week, falling below the $66,000 mark that it reached in late September. This sharp drop has led to widespread panic among investors, causing a significant sell-off across the cryptocurrency market.
Concerns about rising tensions in the Middle East and the overall uncertain economic environment have contributed to the bearish sentiment, making investors wary of further losses.
However, according to Quinn Thompson, Chief Investment Officer at Lekker Capital, this recent decline in Bitcoin’s price is far from catastrophic. He believes the current dip offers a valuable buying opportunity, arguing that the market conditions today are fundamentally different from previous downturns.
Thompson suggests that investors should seize this moment to accumulate more Bitcoin before the price begins to recover, as he expects a substantial upward movement in the near future.
Bitcoin Drops Over 6% Amid Market Panic but Analysts Predict a Potential Rebound
Thompson’s analysis focuses on the 200-day moving average (MA), a key technical indicator that measures an asset’s mid-term momentum. Historically, when Bitcoin has fallen below this level, it has been followed by a recovery.
However, this time, Bitcoin has bounced back above the 200-day MA, which Thompson views as a major shift in the market’s macro backdrop. This technical rebound is seen as a strong signal that Bitcoin may soon experience a significant price surge.
Despite Thompson’s optimism, the broader market remains rattled by geopolitical and economic uncertainty. The growing conflict in the Middle East and concerns about the U.S. economy and upcoming elections have led to a cautious, risk-off attitude among investors.
As a result, many are pulling back from high-risk assets like Bitcoin, contributing to the current downward trend. This caution has led to a gloomier outlook among investors, further amplifying the sell-off.
Historically, October has been a strong month for cryptocurrencies, earning the nickname “Uptober” due to the typical bullish price movements. However, this year’s downturn has cast doubt on whether the usual October rally will take place.
Despite this, some analysts, including those from Santiment, suggest that the lack of optimism in the market may pave the way for a potential rebound. While it remains unclear whether the broader downtrend has ended, there is hope among some investors that Bitcoin may still experience a sharp rally later in the month, similar to previous years.
