The latest ARK Invest report highlights critical support levels for Bitcoin. Key price levels mentioned are $52,000 and $46,000.
BTC Support Levels
Bitcoin ended August down nearly 9%, giving bulls cause for concern. BTC/USD no longer respects classic bull market support levels in the form of its 200-day moving average and short-term holder cost basis, defined as $63,693 and $63,245, respectively. Based on a chart, the on-chain reversion level near $46,000 is the last opportunity for recovery. 'Currently, Bitcoin's most important price supports are at $52,000 and $46,000, the latter confirmed by its on-chain mean,' the report notes.
Bitcoin ETF Situation
Institutional investors also face unrealized losses. Holders of US spot Bitcoin exchange-traded funds risk being in the red eight months after their 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,' the report states.
Bitcoin Bear Market Risks
Despite pessimistic projections, positive aspects of the current market conditions have emerged. ARK points to BTC price drawdowns adhering to historical norms, low levels of short-term holder liquidations, and favorable macroeconomic conditions as reasons for optimism. Bitcoin’s 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 notes.
Bitcoin is at a crucial stage in its market evolution. Current support levels of $52,000 and $46,000 are key indicators of future price movements.
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