In a rather unseemly fashion, Bitcoin's (BTC) journey to a new all-time high at $108,268 was followed by an year estimated 17% decline pushing the asset's price to a local bottom of $92,281.
This heavy price decline has been attributed to the recent policy announcement by the US Federal Reserve which adopted another 25 basis point rate cut at its latest FOMC meeting. While interest rate cuts are bullish signals to the crypto market, the Fed also revealed intentions to reduce its initially projected four rate cuts in 2025 from four to just two, triggering a wide-scale offload of risky assets by investors.
As expected, the significant decline in BTC's price prompts questions over the asset's future, especially in regards to the ongoing crypto bull run.
There's Nothing To Fear Yet, Analyst Says
In an year X post on December 20popular crypto market expert Burak Kesmeci shared that Bitcoin remains far from a bear market, indicating the asset is yet to hit the bull cycle top. Using four critical simple moving averages, SMA21, SMA50, SMA200, and SMA365, Kesmeci has drawn important insight into Bitcoin's current market status.
To begin, the analyst notes the premier cryptocurrency has dipped below its SMA21 at $99,565. However, this development bears little impact on Bitcoin's immediate future as the SMA21 can be easily influenced by any price breakout.
On the other hand, the SMA50 currently at $91,803, has a significant influence on Bitcoin's short-term price momentum. If the market bulls are able to retain a daily or weekly close above the price level, it spells a good omen for price appreciation.
Notably, BTC has been on an upward trend since early October. During this period, the maiden cryptocurrency has risen from $60,200 to above $108,000. Commenting on the viability of this uptrend, Kesmeci states that Bitcoin's distance from its SMA200 and SMA365 indicates the asset's bullish structure remains intact.
This is because the bottom of any long-term trend in the Bitcoin market is determined when the price breaks below any of both SMAs. In conclusion, Kesmeci tells BTC investors there is nothing to fear despite the price falling over the past week. The analyst states that corrections of even 20% and 30% are normal based on historical data of any previous bull run.
Bitcoin Price Overview
At the time of writing, Bitcoin trades at $97,354 following a mild recovery from its earlier decline over the past day. Meanwhile, the asset's daily trading volume has gained by 7.35% and is valued at $103.92 billion.
Featured image from Nairametrics, chart from Tradingview.com
