Not the bottom yet? What is the bottom price target set by BTC traders?

Author: Nancy Lubale, CoinTelegraph; Compiled by: Baishui, Jinse Finance

In the early Asian trading on August 5, risk aversion enveloped global markets and Bitcoin fell below $50,000. In the past three days, Bitcoin has fallen nearly 31%, which is a "rare event in 7-10 years", and analysts are divided on whether Bitcoin will recover in the short term.

BTC/USD daily chart. Source: TradingView

After Bitcoin fell below $50,000, more than $500 billion evaporated from the cryptocurrency market in just 24 hours, and a large number of leveraged positions were liquidated.

According to Coinglass data, about $1.08 billion worth of leveraged positions were liquidated in the derivatives market, of which long liquidations accounted for 74%, or $803.76 million.

During the same period, more than $404.63 million worth of Bitcoin positions were liquidated, of which $282.81 million were long liquidations.

Total cryptocurrency liquidations. Source: Coinglass

Market views on Bitcoin price recovery are mixed

The current pullback in Bitcoin prices comes against the backdrop of a number of factors, including weak U.S. economic and employment data on August 2 that sparked recession fears, as well as heightened tensions in the Middle East.

“Are we facing a perfect storm?” QCP analysts said in an article on X on August 5.

Independent trader Bob Loukas called this a "one in 7-10 year event," which makes it difficult to tell what the market will do immediately after such a drop.

Loukas believes that this pullback could last until mid-September, with a good bounce at some point. "In the end it looks like just a deeper cycle pullback," he added.

Analyst McKenna warned Bitcoin investors not to expect a big recovery in the short term, adding that the market could "travel sideways for 1-2 months."

“This is not a V-bottom situation. I believe prices will remain low for some time and enter an accumulation market phase.”

Michael van de Poppe, founder of MN Capital, took a more neutral stance, saying that a continued adjustment in BTC prices could determine the bottom of the cycle or trigger a “big crisis.”

“It’s binary. Either a V-shaped recovery or a shift to $BTC as a safe haven alongside gold and $ETH, replacing DeFi as a safe haven for the banking system.”

BTC/USD Daily Chart - Source: TradingView

If the V-shaped recovery scenario plays out, BTC could surge in the coming days, rising 32% to retest $70,000. levels of the U.S. dollar. The relative strength index (RSI) is in the oversold zone of 28, which suggests that the downside momentum may soon lose steam, leading to a rebound if bulls start buying on dips.

Analysts Target $40,000 for Bitcoin

The ongoing market correction has market participants wondering how low the Bitcoin price can fall before the trend reverses.

CryptoQuant founder Ki Young Ju has set a lower target in the demand range of $45,000 to $55,000, which is the cost basis of "miners" and "Binance traders", respectively. It is well known that the cost basis of traders supports prices during bull runs.

Young Ju warned that if prices fall below this demand range, a bear market will be confirmed, just as it did in November 2018, March 2020, and May 2022.

Bitcoin cost basis comparison. Source: CryptoQuant

For prominent analyst Scott Melker, the price of Bitcoin could fall below $45,000 before September.

“Polymarket traders are betting that Bitcoin will continue to fall, predicting a 45% chance of a drop below $45,000 before September. This sentiment surged to 65% during early European trading hours amid a large number of liquidations,” Melker said in an August 5 post.

Bitcoin analyst Tuur Demeester went on to point out that BTC is trading just above $51,000 and said that the $45,000 to $40,000 demand zone could be a technical downside target for BTC.

Source: Tu ur Demeester