The world’s leading cryptocurrency by market capitalization, Bitcoin, has recently shown signs of a rebound following a significant dip to a monthly low of $55,500. After experiencing a 10% drop in recent days, Bitcoin’s price surged by over 5% in the past three days, suggesting a possible reversal in its downward trend. However, despite these positive signals, cryptocurrency analyst VirtualBacon has issued a warning about a potential “shakeout” that could precede the much-anticipated bull run expected in 2024.

Anticipating a Shakeout

In his latest updates on X (formerly Twitter), VirtualBacon has highlighted the possibility of a final price plunge before Bitcoin embarks on its next significant upward trajectory. According to VirtualBacon, while current market conditions are fraught with uncertainty and fear, the underlying fundamentals suggest that a bull run remains likely. He anticipates that Bitcoin might experience one last drop into the low $40,000s before it can surge to new highs.

Concerns of a Prolonged Bear Market

Despite recent price fluctuations and market anxiety, VirtualBacon downplays the risk of a prolonged bear market. The recent trend of lower highs and lower lows in Bitcoin’s price has raised concerns among some investors about a potential extended downturn. However, VirtualBacon argues that these patterns do not necessarily indicate a long-term bearish trend. Instead, he points to the Federal Reserve’s expected rate cuts and liquidity injections as key factors that will likely stimulate a bull market, potentially extending into 2025.

Critical Support Levels to Monitor

As Bitcoin navigates through this period of volatility, several support levels have emerged as crucial for the cryptocurrency’s price stability. One of the key levels to watch is the 100-week Exponential Moving Average (EMA), which is currently positioned around $45,000. Historically, this EMA has marked the end of previous bear markets, such as in 2015 and 2019, where Bitcoin saw significant rebounds after touching this support level.

Technical indicators, including Fibonacci retracements and high-volume nodes, suggest that Bitcoin’s support range between $43,000 and $49,000 is particularly strong. Even if Bitcoin experiences a brief dip into this range, it is more likely to bounce back rather than face a prolonged decline.

October’s Potential Green Signal

Many traders are closely monitoring Bitcoin’s price as it approaches the $50,000-$51,000 range. However, VirtualBacon warns that reaching these levels could trigger cascading liquidations, potentially driving the price down to $44,000. This scenario could lead to rapid losses for early directional bets and highlight the need for caution and portfolio protection during this volatile period.

Historically, September has been a weaker month for Bitcoin, but VirtualBacon remains optimistic about the market’s performance in the final months of the year. October, November, and December have often seen bullish trends, offering hope for a strong finish to 2024. The upcoming Federal Open Market Committee (FOMC) meeting is expected to be a critical event, with anticipated rate cuts in September likely to boost liquidity and benefit assets like Bitcoin.

Looking Ahead to the Bull Run

Despite the current market fears, VirtualBacon encourages investors to stay calm and focused. The fear and greed index currently reflects high levels of fear, but the expected policy changes from the Federal Reserve could rapidly shift market sentiment. VirtualBacon’s bullish outlook predicts that Bitcoin could potentially exceed $100,000, with a possibility of reaching $200,000 by the end of 2025. This surge could also lead to substantial gains for mid to large-cap altcoins, with potential returns of 10x to 20x.