The leading cryptocurrency, Bitcoin (BTC), surged above $82,000 in the first week of May, but this was short-lived. Since mid-May, factors such as rising geopolitical risks in the Middle East and increased ETF outflows have caused the BTC price to fall to $65,000.
However, Bitcoin has reached its lowest point at the Power Law level, historically signaling a recovery.
Market analyst James Van Straten noted in his latest analysis that the price has fallen to 4.4%, near the lower bound of the Power Law model, a long-term technical valuation pattern.
At this point, the analyst noted that Bitcoin may be preparing for a significant recovery according to this model.
According to the analyst, this level of decline is extremely rare in Bitcoin’s history. In the Power Law Model, a 4.4% drop for Bitcoin indicates that the current price is 95.6% cheaper than the long-term trendline.
Historically, BTC has only reached such low levels during the COVID-19 crash in March 2020 and the FTX crash in November 2022.
According to the analyst, this makes the current period the third most attractive dip buying opportunity on record.
While the Power Law Model doesn’t guarantee the current support level will be definitively maintained, the analyst noted that long-term mathematical analysis of Bitcoin indicates that downward pressure is extremely limited.
*This is not investment advice.
