A cryptocurrency analyst has posited that the maximum pain for Bitcoin this cycle will be a fall to $55,000, based on technical indicators, rather than the $35,000 some market participants predict.
A drop to $35,000, as predicted by some, would represent a retracement of 72%. This magnitude of decline has occurred historically. Bitcoin experienced a 77% fall from its November 2021 high of $69,000 to a bottom of $15,500 in November 2022.
However, an analyst known as “Sykodelic” stated on Tuesday to his 62,000 followers on X that predictions of a Bitcoin plunge to $35,000 in 2026 are "absolute rubbish."
Sykodelic explained that for Bitcoin to retrace 75%, it would need to have experienced a significant expansion, which he argues has not occurred this cycle. He elaborated that such deep retracements are only possible when the level of expansion, as indicated by the relative strength index (RSI), makes that level of contraction feasible.
Bitcoin (BTC) is currently trading 31% below its early October peak of $126,000, a pullback that is not unusual even within a bull market.
Bollinger Bands as a Key Indicator
The analyst highlighted that Bitcoin prices have historically never fallen below the Bollinger Bands on the monthly time frame.
He drew a comparison to the 2017 cycle, which saw substantial gains, yet the subsequent retracement did not cross below the monthly lower Bollinger Band. The analyst questioned why the current cycle, after the weakest expansion ever, would experience the deepest contraction.
Basically, in an absolute worst-case scenario, and if this is a big bear market, if we close this monthly candle below the mid-line, then we could be expecting a maximum bottom of $55k.
Alternative Analyst Views on Bitcoin Correction Depth
Jeff Ko, Chief Analyst at the CoinEx exchange, shared with Cointelegraph that even a correction to $55,000 is unlikely. He argued that the bear-case scenario would likely see Bitcoin revisiting the $65,000 to $68,000 levels.
Ko suggested that the traditional four-year cycle structure is evolving. With Bitcoin now significantly more institutionalized, he stated, "I do not expect another 70%–80% drawdown from all-time highs."
Market depth, ETF participation, and a structurally broader investor base all suggest that future corrections will be shallower and more orderly compared to previous cycles.
Potential for Catastrophic Decline if Support Zone Breaks
Augustine Fan, head of insights at crypto trading software service provider SignalPlus, expressed a bearish outlook if the significant support area around $72,000 to $75,000 breaks down.
He warned that a break below this level would likely trigger catastrophic stop-loss orders with currently unknown consequences, given the volume of stop selling, the impact on trading strategies, and their viability due to significant implied losses.
At the time of writing, Bitcoin was trading around the $87,000 level, showing a slight recovery from its Monday fall to $84,000.