Bitcoin (BTC) is at a “make-or-break moment” as it faces a duel with crucial support, new research warns.
In its latest monthly report, US investment management firm ARK Invest said key BTC price levels are now $52,000 and $46,000.
BTC price preserves “most important” floor levels
Bitcoin has failed to bounce significantly after finishing August down nearly 9%, ARK Invest summarizes, and there is plenty for bulls to worry about.
BTC/USD is no longer respecting classic bull market support levels in the form of its 200-day moving average and short-term holder cost basis, defined by the report as $63,693 and $63,245, respectively.
A chart showing mean reversion levels leaves the onchain reversion level near $46,000 as a last chance, with ARK defining its overall stance as “bearish.”
“Currently, bitcoin’s most important price supports are at $52,000 and $46,000, the latter confirmed by its on-chain mean, the red line on the chart,” accompanying commentary confirms.
BTC/USD mean reversion chart (screenshot). Source: ARK Invest
Just like the short-term holders, the term given to Bitcoin’s more speculative hodler cohort, institutional investors also face unrealized losses.
Holders of the US spot Bitcoin exchange-traded funds (ETFs), ARK calculates, risk being in the red eight months after launch.
“At the end of August, the estimated cost basis of US spot ETF participants was higher than bitcoin’s price, suggesting that the average ETF investor may be at a loss,” it states.
US spot Bitcoin ETF data (screenshot). Source: ARK Invest
Bitcoin bear market risk
Despite the gloom, positive aspects of the current market landscape have emerged.
Related: Is crypto entering a bear market? — 5 Things to know in Bitcoin this week
ARK points to BTC price drawdowns sticking to historical norms, low levels of short-term holder liquidations and favorable macroeconomic conditions among the reasons for optimism.
Bitcoin MVRV Z-score, which compares market cap to its cost basis, also remains in “bull market territory.”
“At the close of August, the MVRV Z-Score was 1.6, relative to its mean at 1.42,” the report explains.
“The mean serves as a demarcation point between the bull market and an impending bear market.”
Bitcoin MVRV Z-score (screenshot). Source: ARK Invest
BTC/USD traded at around $58,000 at the time of writing on Sept. 13, per data from Cointelegraph Markets Pro and TradingView, down 1.9% month-to-date.
BTC/USD 4-hour chart. Source: TradingView
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.