According to analysts, Bitcoin's recent price decline is mostly coming from profit-taking.
Despite the drop below $60,000, experts believe a massive price surge is possible.
According to Raoul Pal, the "Banana Zone" is a period of extreme volatility—Jamie Coutts believes that Bitcoin is headed there.
There are several opinions among crypto analysts about Bitcoin's future price movement.
Ultimately, some key BTC price levels to watch include $62,000, $65,000, $70,000 and $72,000.
Bitcoin has been through a lot this week, particularly with its most recent price drop below $60,000.
However, despite this major setback, analysts believe that we might be ready to see a massive pump in Bitcoin's future, particularly before the end of 2024.
Can Bitcoin enter the so-called "Banana Zone" and reach $150,000 this year?
According to various analysts and on-chain analytics platforms, Bitcoin's recent price dip was mostly due to profit-taking by short-term holders.
This happens because investors mostly look for ways to cash in their profits from prior price increases (Bitcoin's retest of $65,000 this week).
This selling pressure triggers more panic in more traders, who also sell their holdings and drive prices further down.
Coinglass data even shows that the liquidations on 27 August were the harshest since the billion-dollar "Black Monday" crash on 5 August.
The total liquidations on Bitcoin
According to the data analytics platform, the bulls that held on to their positions lost a whopping $85 million on Tuesday this week.
However, these short-term declines don't necessarily mean that the bear market has begun.
In fact, many experts even believe that Bitcoin's ongoing bearishness might be short-lived and could be paving the way for an incoming price explosion.
Real Vision founder Raoul Pal coined the term "Banana Zone”.
This refers to a period in Bitcoin's price trajectory when the market experiences extreme volatility, and its price action becomes very unpredictable.
According to a recent post on X from Jamie Coutts, Bitcoin might be on the verge of entering this so-called banana zone—a place he calls the "batshit season".
"batshit", according to the Oxford Dictionary, is another word for "completely mad or crazy."
In the charts Coutts attached to his tweet, he showed that in the last two cycles, Bitcoin hit new cycle highs around 365 days after the peak of the US Dollar Index.
In essence, if something similar happens again this time around, we might see more than a 100% surge from the current price range of between $60,000 and $65,000 to a staggering $150,000 by the end of 2024.
Coutts' outlook is very optimistic. However, other analysts are warning investors to exercise caution due to the increasing panic among short-term Bitcoin sellers.
According to an analyst from CryptoQuant, this cohort of investors has recently transferred massive amounts of Bitcoin, which might lead to more serious selling pressure.
A damper on Bitcoin’s price action
The CryptoQuant report even states that these short-term investors transferred 33,155 bitcoins within the last month and are putting a massive damper on Bitcoin's bullishness.
In essence, if they continue to sell this way, Bitcoin might take much longer to hit this price level.
There is hope, though. According to renowned analyst Peter Brandt (who is famous for accurately predicting the 2017 Bitcoin crash), Bitcoin might be poised to rally, as Coutts says.
Even despite the recent crash from $65,000 to below $62,000 and then further down below $60,000, Brandt believes that the current sellers will soon run out of fuel.
In a recent blog post on Substack, the analyst mentioned that he had taken long positions in Bitcoin and expects a breakout from the cryptocurrency's current megaphone formation.
Bitcoin should be able to break out.
The analyst says there are ongoing signs of upward momentum, and a rally could be on the horizon if Bitcoin breaks through some key resistance levels.
In particular, the most important of these is the $72,000 zone.
If we see a break above this price level, Bitcoin will have signalled a bullish trend beyond all doubt and will rally straight up for this new all-time high that Coitts envisions.
In summary, the key price levels to watch at this point should be $62,000, $65,000, $70,000 and then $72,000.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.