Bitcoin (BTC) is at a “make-or-break moment” as it faces a showdown with key support, a new study warns.
ARK Invest, an American investment management firm, said in its latest monthly report that the key BTC price levels are currently $52,000 and $46,000.
BTC price holds “most important” floor level.
According to ARK Invest, Bitcoin has not bounced back much since its nearly 9% drop in August, and there is plenty to worry about in the bull market.
BTC/USD is no longer following the classic bullish support levels in the form of the 200-day moving average and the short-term cost of holding (USD 63,693 and USD 63,245, respectively, according to the report).
The chart showing mean reversion levels sees the on-chain reversion level near $46,000 as the last opportunity, with ARK defining the overall stance as “bearish.”
“Currently, Bitcoin’s most important price support levels are $52,000 and $46,000, the latter confirmed by the on-chain average, the red line on the chart,” the accompanying commentary confirms.
BTC/USD Mean Reversion Chart (Screenshot). Source: ARK Invest
Just like short-term holders (speculative holders of Bitcoin), institutional investors also face unrealized losses.
According to ARK estimates, holders of U.S. spot Bitcoin exchange-traded funds (ETFs) are at risk of losing money within eight months of launch.
“As of late August, the estimated cost basis for U.S. spot ETF participants was higher than the bitcoin price, suggesting that the average ETF investor could be losing money,” the report said.
US Spot Bitcoin ETF Data (screenshot). Source: ARK Invest
Bitcoin Bear Market Risk
Despite the gloomy mood, there are also positive aspects to the current market environment.
relevant: Is Cryptocurrency Entering a Bear Market? — 5 Things to Know About Bitcoin This Week
ARK cited the BTC price downtrend remaining at historical levels, low levels of short-term liquidation, and favorable macroeconomic conditions as reasons for optimism.
Bitcoin’s MVRV Z-score, which compares market cap to cost, also remains in “bullish territory.”
“At the end of August, the MVRV Z-score was 1.6, compared to an average of 1.42,” the report explains.
“The average acts as a boundary between a bull market and an impending bear market.”
Bitcoin MVRV Z-Score (screenshot). Source: ARK Invest
According to data from Cointelegraph Markets Pro and TradingView, at the time of writing on September 13, BTC/USD was trading around $58,000, down 1.9% this month.
BTC/USD 4-hour chart. Source: TradingView
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.