In an X post published yesterday, experienced crypto analyst Ali Martinez highlighted that based on price range analysis, bitcoin (BTC) could jump to $112,000 if it breaks and holds above a key level.
Analyst outlines key level of bitcoin
After a slight rise following the US Federal Reserve's (Fed) announcement to slow the pace of balance sheet drawdown, bitcoin is currently trading in the low price range of $80,000. However, according to Martinez, the leading cryptocurrency could reach a new all-time high (ATH) under certain conditions.
Using price bars for the extreme deviation of market value to realized value (MVRV), Martinez pointed to two key price levels that could determine Bitcoin's next big move. According to the analyst, if BTC breaks through and holds above $94,000, there is a "high probability" that it will rise to $112,000.
On the other hand, if BTC falls below $76,000, it risks falling to $58,000 - or even $44,000 - if market conditions turn bearish. It should be noted that BTC previously reached $76,606 on March 10 before returning to its current range at the low $80,000.
For the uninitiated, MVRV Extreme Deviation Pricing Bands indicate whether an asset, such as bitcoin, is priced too high or too low compared to its past averages. It helps spot when the market may be overbought - a potential market top - or oversold - a potential buying opportunity.
According to Martinez's chart, BTC is currently trading between the mean - yellow bar - and +0.5 standard deviation - orange bar. A sustained break above or below these bars could indicate the next significant direction of the BTC price.
Fellow crypto analyst Rekt Capital noted that bitcoin is retesting the crucial $84,000 support level. A successful hold at this price could cause BTC to challenge the $94,000 resistance, potentially paving the way for a new ATH. The analyst said:
BTC has produced long wicks below this level before, so a daily close above $84k is essential for this retest to be successful.
Will BTC witness a brief contraction?
In a separate X post, crypto trader Merlijn The Trader suggested that widespread pessimism surrounding recent BTC price action could fuel a powerful short squeeze. According to the analyst, about $2 billion worth of short positions could be liquidated if BTC reaches $87,000 - potentially leading to an even higher price.
In addition to the bullish outlook, crypto entrepreneur Arthur Hayes suggested that BTC's March 10 drop to $77,000 may have marked the bottom of this market cycle. At the time of writing BTC is trading at $84,043, down from 2% in the last 24 hours.
