Bitcoin (BTC) has had a rough start to September, falling 8.16% over the past seven days, according to data from CoinMarketCap. Although the cryptocurrency market leader has shown some signs of recovery over the past day, there are still many uncertainties surrounding the BTC market. Commenting on Bitcoin’s potential next move, popular analyst Ali Martinez issued a stern warning to investors.
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Bitcoin Must Avoid Drop to $51,600 – Analyst
In a Saturday article on X, Ali Martinez issued a market red alert to traders, stating that whenever the price of Bitcoin dips below its price-to-realized ratio, it often results in a prolonged decline in price back to the realized price.
The price-to-realized liveliness ratio is a market metric used to assess when BTC might be overvalued or undervalued. As the name suggests, it is calculated by dividing the realized price, which is the average price at which all Bitcoins in circulation were purchased, by the liveliness, which is a measure of the activity of the Bitcoin network.
According to Martinez, BTC’s current realized price-to-vitality ratio stands at $51,600. Based on historical data, if the leading cryptocurrency falls below this level, it is likely to enter a period of massive selling pressure, dropping to its current realized price which is valued at $31,500.
Bitcoin has had a turbulent September so far, falling from $59,000 to below $54,000 in the first week of the month. However, the digital asset has barely held up since then, rising more than 2% to nearly $55,000 on Saturday. While this slight price increase may start a bullish trajectory, investors should note that September is traditionally a month of bearish returns for BTC, with an average loss of 4.78% over the past 11 years.
Bitcoin Far From Seller Exhaustion Levels, But Price Reversal Could Still Be Delayed
In other news, another cryptocurrency analyst, Rekt Capital, said that Bitcoin’s selling volume is currently far from its “seller exhaustion levels” amid recent price declines and increased volatility levels. Thus, the digital asset is likely to experience more price losses before potentially “triggering” a market rebound.
At the time of writing, BTC is trading at $54,009, reflecting a gain of 0.45% over the past 24 hours. At the same time, the token’s daily trading volume has decreased by 60.39% and is currently valued at $19.41 billion. It is worth noting that Bitcoin is currently in a strong support zone, a bounce from which could potentially push the asset’s price up to $60,000, indicating a potential 11% upside on its current price.
Featured image by StormGain, chart by Tradingview
