Bitcoin’s Breakout Zone Will Set the Tone for Future Price Behavior

Bitcoin’s price pulled back from an $82,833 local high last Wednesday, returning below the $80,000 mark to leave the cryptocurrency in critical condition, according to data from TradingView.

The latest Bitcoin display highlights the significance of its current price region, with analysts citing crucial events that could trigger extended moves up or down, depending on the breakout direction.

Bitcoin’s Average Cost Basis for New Whales

Renowned cryptocurrency analyst, Ali Martinez, identified the current price range as the most important resistance level for Bitcoin.

According to Martinez, the average cost basis of new whales that bought Bitcoin in the last 155 days is currently $80,300. He believes the whales’ response to the Bitcoin market will depend on how $BTC performs around this price.

For context, the whales trade at a loss when Bitcoin drops below their average cost basis. The cryptocurrency’s latest rally, which saw it push above $82,800, moved the whales’ positions into profit. However, that was short-lived as $BTC declined below $80,000 on Thursday, triggering concerns about the sustainability of the recently discovered bullish momentum.

How Would Whales React to Price Moves?

Martinez thinks Bitcoin’s failure to stay above $80,300 will incentivize the whales to sell their assets to break even and avoid further losses. Such a decision by Bitcoin whales could create a wave of selling pressure that would push prices much lower.

However, flipping the $80,300 resistance to support could be Bitcoin’s most crucial move this season. According to Martinez, it would signal an exhaustion in selling pressure and encourage the whales to hold for higher targets. That would be a classic setup for the beginning of an uptrend.

Bitcoin’s Last Line of Defence

Foremost cryptocurrency investor Ted Pillows views Bitcoin price development in a way similar to Martinez’s analysis. Pillows considers the $80,000 region crucial for $BTC in the current setting. However, he identifies the price level between $78,000 and $79,000 as the cryptocurrency’s next defence from where he expects it to bounce back.

According to Pillows, breaking below this zone could mean a deeper correction for Bitcoin, while holding that support will prepare the cryptocurrency for an upsurge that could push it toward $90,000.

Bitcoin traded for $80,249 at the time of writing, after bouncing off support at $79,168 in the early hours of Friday, according to TradingView’s data.

Related: Bitcoin Price Prediction: Tom Lee Says One Monthly Close Ends the Bear Market for Good