Some analysts say that the cost of Bitcoin (BTC) could drop to $27,000 in a bearish scenario if it falls through the $30,000 support area.

The potential drop to $27,000 is conditional in that BTC would accept to intermission down below $xxx,500, where it strongly bounced from on Jan. xi.

Bitcoin whale clusters. Source: Whalemap

Which is the short-term Bitcoin bottom?

In the foreseeable future, there are 3 key technical levels at play for Bitcoin: $34,500, $30,500, and $27,000.

$34,500 has been acting equally a critical support surface area throughout the past 72 hours. Each time BTC dropped to this level, it recovered adequately quickly to around $36,300.

If $34,500 breaks, the next major back up level is $30,500. This is where Bitcoin recovered from in the big correction on January. 11, when $ii billion worth of futures contracts were liquidated.

A pseudonymous trader known as "Alex," for example, said that if Bitcoin heads back downward to $30,000 with no visible buyer reaction, the trade would be to wait for $27,000 or a motility dorsum upward in a higher place $30,000. He said:

"Determination making is dynamic. Zippo is set up in rock. But about likely if price heads back downwardly to 30K 'll exist holding off adjacent time. The gameplan is to accept ammo to buy the dip (to redeploy). If 30K breaks absolutely no ownership until down to 27Ks or back above 30K."

Similarly, another popular pseudonymous trader known as "Mayne" said that losing $33,000 would likely result in $27,000. Prior to the weekly candle open up on Jan. xviii, the trader wrote:

"I think we concord here ($33,000) and get a solid bounciness going into Monday. If we lose this level, Bitcoin is really a scam and I denounce any clan I ever had with it until $27k."
4-hour Bitcoin price candle chart with levels. Source: TradingView.com, Mayne

What happens to altcoins if $xxx,000 breaks?

Alex emphasized that altcoins would likely get "obliterated" with 30% to 50% corrections if Bitcoin falls back down to $27,000.

Altcoins are typically less liquid and have a much lower volume than Bitcoin. Hence, during a behave cycle, altcoins often see steeper pullbacks compared to BTC. The trader explained:

"If for whatever reason $BTC falls to 27K, expect alts to get obliterated with 35%-50% intraday pullbacks. So in that scenario, buying alts volition be meliorate than buying $BTC. Definitively better ownership alts in that location than buying $BTC on leverage. Identify the winners, and jump in."

So far, Bitcoin is slowly recovering from the $34,500 support level, which is a positive trend. Information technology as well marks a whale cluster support level, meaning that whales are likely to protect that level with buy orders.

The presence of whale clusters at $34,500 explains why Bitcoin has been seeing potent bounces in that area in the last 48 hours. In the virtually term, the key to a convincing recovery would be protecting this level.