TLDR
- Bitcoin has never dropped below the monthly Bollinger Band in previous cycles.
- Bitcoin is down 31% from its peak of $126,000 reached in early October.
- RSI and limited expansion suggest shallow contraction compared to past cycles.
- Analysts expect $55,000 to be the lowest if current support levels break.
Bitcoin’s price correction may not go lower than $55,000, according to technical indicators used by crypto analyst “Sykodelic.” The analyst pointed to historical behavior in the monthly Bollinger Bands and the Relative Strength Index (RSI) to argue that this cycle’s bottom will be much higher than the $35,000 level suggested by others.
Bitcoin has experienced a 31% drop from its early October high of $126,000, now trading around $87,000. Although this decline is sharp, it remains within the expected range during a bullish cycle, according to Sykodelic’s analysis.
Bollinger Bands Used to Predict Cycle Bottom
The analyst noted that Bitcoin has never dropped below its lower monthly Bollinger Band, even during strong bearish cycles. This historical pattern supports the idea that current levels may already be near the cycle low. “Basically, absolute worst-case scenario and if this is a big bad bear… if we close this monthly candle below the mid line, then we could be expecting a maximum bottom of $55k,” Sykodelic said.
He also rejected predictions of a 72–75% retracement, which would bring Bitcoin down to around $35,000. That level of contraction would require a much stronger expansion phase, as indicated by a high RSI. “For Bitcoin to retrace 75% it actually has to fully expand, and this cycle, it just did not do that,” he added.
Other Analysts Predict a Shallower Correction
Jeff Ko, chief analyst at CoinEx exchange, also believes the correction may not go as deep as $55,000. He said the more likely retracement zone is between $65,000 and $68,000. Ko attributed this to changes in market structure, noting that institutional participation, ETFs, and broader adoption make deep corrections less probable.
“I do not expect another 70%–80% drawdown from all-time highs,” Ko told Cointelegraph. He explained that the maturing market now includes a wider investor base, which can cushion large price swings more effectively than in earlier cycles.
Support Levels Watch Critical in Coming Weeks
Despite more optimistic projections, some analysts have expressed concern over potential breakdowns in support. Augustine Fan from SignalPlus said the $72,000 to $75,000 range is a critical zone. If Bitcoin breaks below this level, the move could trigger stop-loss orders and increase downward pressure.
“A break below will likely lead to catastrophic stops with unknown consequences for now,” Fan said. These consequences may include forced liquidations from large trading strategies facing severe losses.
Bitcoin was hovering around $87,000 at the time of reporting, showing signs of recovery after dipping to $84,000 earlier in the week.
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