- Rekt Capital says Bitcoin must decisively break above $93.5k this week.
- A failure could mean the breakdown of the current long-term uptrend since November 2024.
- A 0% rate cut could bring a crash to $75k, and negative guidance opens the risk to $56k.
- Fresh estimates suggest a fall could potentially bring BTC to $56k range.
- Possible end of institutional liquidity forces investors to sell in advance.
Bitcoin is Below Critical Level, Must Cross $93.5k
Rekt Capital posted on its X handle that Bitcoin was below the Macro Diagonal Line. The line is central to Bitcoin keeping its uptrend in a post-halving market. If BTC continues to trade below this line this week, it could open a new risk to its price.
Rekt Capital is the creator of the Macro Diagonal Theory that seeks to predict Bitcoin’s price behavior between the Halving Cycles.
To prevent any collapse of Bitcoin’s uptrend (started in October 2024), Bitcoin must cross $93.5k levels within the first week of December 2025. If it fails to cross, which is the likely case, Bitcoin could sink further below.
Further Risk till $56k Opens up on the Downside
In the event that Bitcoin does not cross $93.5k by this week, we might see a further collapse towards $75k, which is lower than the lowest level this year (i.e., $82k). If Bitcoin crosses below $75k, we could even see $56k as the lowest point of this downtrend.
However, the fall to $75k is only possible if the US Federal Reserve does not cut interest rates further.
In the rare event that the US Fed provides negative guidance on the January Policy Meet, we could see BTC sliding down even further towards $56k. We are not expecting a crash below $56k.
Institutional Liquidity is at Stake
Fundamentally, Bitcoin is at its worst stage because the institutional buyers that have been pouring liquidity into the current markets are at risk of being removed from stock market indices.
Strategy(MSTR) by Michael Saylor, which operates the largest Bitcoin Treasury, is at risk of getting removed from the S&P500, which means that all index funds that have MSTR shares might have to sell them in the open market. The same is the case with all Bitcoin Treasuries. If that happens, we could see these treasuries dumping BTC on the market.
A fear of these events forces whales and retail sellers to sell Bitcoins before any hint of a crash.
Disclaimer: Crypto markets are volatile in nature. All articles on A2Z Cryptocurrencies are informational and are not financial advice. Please consult your financial adviser before investing.
