It sounds almost surreal that only weeks ago BTC was fighting to stay above $60,000, while it now trades around $80,000. Its awakening has sparked widespread enthusiasm within the community and prompted analysts to call for an end to the bear market.

However, not all are convinced that the bulls have fully regained control, as some expect the resurgence to be a major trap that could lead to a collapse well below $50,000.

Sharp Red Candle Incoming?

The past several days have been wild for the entire cryptocurrency market and have positively surprised the investors who might have grown tired and uninterested during the prolonged bearish cycle. Bitcoin jumped by 23% over the last week, briefly exceeding $81,000, and here are the exact factors that sparked the rally.

And while many industry participants have popped the champagne and started celebrating the potential beginning of a new bull run, others remain highly cautious. X user AlejandroBTC claimed BTC faces a major pullback ahead that could take the price to as low as $40,000.

“This is what I think happens next: Bitcoin tests $68K–70K. We get a small bounce. Then we come back to that zone again, and this time it doesn’t hold. That’s when the panic starts. Liquidations accelerate, sentiment collapses, and I think we go straight toward $40K,” the analyst predicted.

X user bee also envisioned a hard rejection. In their view, BTC might experience a sharp red candle (not a slow pullback) that could erase almost all of the gains from the past several days.

Earlier this week, Nonzee argued that the asset’s pump was caused by a liquidity squeeze. They believe the green wave could be a bull trap that might eventually lead to a violent move south toward $45,000.

Bitcoin’s Relative Strength Index (RSI) supports the bearish perspective. The ratio has soared to 83, entering extreme overbought territory, a level that has historically been followed by a short-term correction.

BTC’s Fear and Greed Index is also worth mentioning. Today (August 25), the figure jumped to 74, the highest mark witnessed since October last year. This suggests that the market has reached an extreme level of euphoria, which often happens when investors are driven by FOMO, and could be another sign of an incoming pullback.

Bottoming Under This Condition

X user Niels, who has previously been quite pessimistic about BTC, also chipped in following the latest rally. The analyst assumed that a weekly close above $83,000 would mean that the bottom is in and that they were wrong about a potential crash toward $55,000.

“If not, Bitcoin is still following the 4-year cycle, and the macro bottom will happen in October,” Niels added.

Source: CryptoPotato