Bitcoin (BTC) Must Defend This Key Price Level

Bitcoin (BTC) has dropped 11.3% over the past week, currently trading in the low $80,000 range at the time of writing.

Bitcoin (BTC) has dropped 11.3% over the past week, currently trading in the low $80,000 range at the time of writing. The recent decline has pushed the leading cryptocurrency below the 200-day moving average (MA), raising concerns about a potential deeper pullback.

However, seasoned crypto analyst Ali Martinez has identified a key price level that Bitcoin must defend to avoid further downward pressure.

According to an X post by Martinez, BTC is now trading below the 200-day MA, a level that has historically functioned as strong support for the top digital asset.

The 200-day MA is a famous technical indicator that represents the average closing price of BTC over the last 200 days to identify the long-term price trend.

A sustained move above the 200-day MA has led to long-term uptrends while a prolonged price movement below the level has often preceded further declines.

“#Bitcoin must stay above the TD Sequential indicator’s risk line at $79,280. A break above this level could pave the way for a strong rebound.”

As seen in the chart above, the TD Sequential indicator’s risk line provides a boundary for price fluctuations.

After setting a high at $109,688 last week, the indicator has now begun setting lower highs and higher lows, suggesting that the current downward trend might be coming to an end.

If the price drops below the risk line, it could indicate further weakness and a continuation of the downward trend. However, a sustained move above this level could set the stage for a strong rebound to the upside.

Meanwhile, fellow crypto analyst Ted has highlighted the potential for a Bitcoin recovery. In a post on X, he observed that over the past two years, Bitcoin has typically undergone 25% to 30% corrections before rebounding to new all-time highs (ATHs).

“In 2023, BTC went from $30K to $22K. In 2024, BTC went from $74K to $50K. This year, BTC has dumped from $109K to $79K. We all know what happened after the last 2 major corrections.”

If Bitcoin follows a similar pattern and rises 30% from its current price, it could reach approximately $104,000 in a short period.

However, broader macroeconomic factors, such as US President Donald Trump’s trade tariffs and the Federal Reserve’s (Fed) monetary policy, could significantly impact Bitcoin’s trajectory.

In another post on X, Martinez highlighted Bitcoin’s potential path to a new ATH, emphasizing that Bitcoin must first reclaim $84,000 as a support level before any major upside movement.

Once this milestone is secured, the digital asset could rally toward $128,000.

Several indicators suggest that Bitcoin may have already found a local bottom, increasing the chances of a trend reversal.

Crypto analyst Rekt Capital recently noted that Bitcoin’s plunge to $78,258 could mark the cycle low.

“Looks like #Bitcoin has finally reached the Fibonacci level that was meant to hold. At least according to the Count.

Set in 3, 7, 11, 21 … the 89 Wave (purple) is meant to be a fib level that holds major trends. At least according to Elliott Wave Theory.”

Additionally, the US Dollar Index (DXY) has just recorded one of its largest weekly breakdowns since 2013, a move that historically signals bullish momentum for risk-on assets like Bitcoin.

The DXY dropped by 1.9% over the past week, closing below the 100-week MA for the first time since November 2022.

This divergence from the 200-day MA, which usually leads to further declines, could be a key factor to watch.