Crypto Analyst Shares Most Expected Scenario for Bitcoin Price as BTC Goes Through ‘Danger Zone’
The concept of a “danger zone” in the Bitcoin market has been a topic of discussion among traders and analysts. According to trader Alan Santana, the “danger zone” is a time-based fractal of past history.
However, the 2023 bullish wave and the new all-time high in 2024 have shattered all time-related predictions based on past history. As a result, we cannot expect situations to develop as they did in the past, but instead, we should prepare for the unexpected.
What you'll learn 👉
Market Sentiment and Expectations
Currently, the most expected scenario is a continuation of the bullish move that peaked on March 14, 2024, at around $74,000. The overall market sentiment remains bullish, with investors and traders anticipating further upside potential for Bitcoin.
However, it is essential to consider the least expected scenario, which, according to Santana, is the most likely scenario. While people are open to the possibility of Bitcoin moving lower, they do not expect it to happen.
They know it is possible, but they cannot see it or understand how it feels. It is not the same as saying, “Bitcoin is going to $150,000, it is going to be great!” versus actually living and feeling the experience.
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Show more +Bitcoin (BTC) Price Prediction: Higher or Lower?
One of the key questions on traders’ minds is whether it is possible to know if Bitcoin is moving higher or lower. Santana suggests that while it may not be possible to know with absolute certainty, we can make an educated guess or prepare for different scenarios based on current and past market action.
By analyzing Bitcoin’s recent price action, we can gain valuable insights into its potential direction. Santana points out that Bitcoin has been declining for two months straight, a total of 60 days. This prolonged downtrend can be interpreted as the bears loading up and building momentum for a potential move ahead.
The Concept of Distribution
Santana introduces the concept of distribution, which is the inverse of the classic accumulation/consolidation phase. During a distribution phase, market participants are selling their holdings, gradually transferring assets from strong hands to weak hands. This process can lead to a significant decline in price once the distribution phase is complete and the market begins to trend lower.
By recognizing the signs of a distribution phase, traders can prepare for potential downside risk and adjust their strategies accordingly. This may involve reducing long positions, setting stop-loss orders, or even considering short positions in anticipation of a potential market downturn.
By analyzing current market action, such as Bitcoin’s 60-day downtrend, traders can make informed decisions and prepare for various outcomes.
Read more: This Solana Meme Coin Skyrocketed by 6,000%: Two Traders Achieve 49x Returns
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