Analyst Justin Bennett discusses how Bitcoin and the crypto markets can recover from a sharp drop in value that wiped out roughly $400 billion in market capitalization.
Over $882,000,000 in liquidations were triggered in a 24-hour period, according to CoinGlass, when BTC Price corrected roughly 10%, pulling the rest of the market down with it.
Bennett warns his 89,000 Twitter followers that if Bitcoin falls below $60,000, a drop to $53,000 is possible.
“Not sure if we’re out of this just yet, but there’s a lot of support around $60,000. I’ll look to $55,000 unless Bitcoin can reclaim $63,300.”
Furthermore, the analyst points out that cryptocurrency prices decline by 20% to 30% on a regular basis, while Bitcoin is only 12% off its high.
What Will Trigger Bitcoin’s Recovery?
Bennett uses the US dollar index (DXY), which compares the US dollar to a basket of other major fiat currencies, to assess the status of the crypto markets. In general, a weaker US dollar indicates higher pricing for many assets, whereas a strong greenback indicates lower costs.
DXY is rising a large ascending channel, according to Bennett. Bennett says that DXY is at a resistance level around the top of the channel and could retrace back down.
“DXY just tested 95.80 resistance, Now close the day back below 95.50.”
A falling dollar has already been mentioned by the crypto expert as a possible under-the-radar catalyst that may send Bitcoin and the rest of the markets surging.
Bennett believes that Bitcoin will end the bull cycle far above $200,000, but over a longer period of time than many assume.
“I still think we see the same cycle peak for $BTC that I’ve mentioned in the past, somewhere between $207k and $270k. But I am starting to think it could take longer to get there than most expect.”