Bitcoin (BTC) Price Could Revisit the 'Buy Zone' of the LGC Model Before It Finds a Local Bottom, Trader Dave the Wave Predicts

Over the last weekend, the Bitcoin price face strong selling pressure taking a dive under $54,500 before recovering the losses partially

A Bitcoin trader who predicted the Bitcoin collapse three years in advance in May 2021 is now predicting further downward action for the Bitcoin price before it resumes the rally to a new all-time high.

Over the last weekend, the Bitcoin price faced strong selling pressure as it dipped below the crucial support of $54,500 before recovering the losses partially, as per the CNF update.

At press time, the BTC price is trading at $57,113.43, down 0.47% with a market cap of $1.126 trillion and daily trading volumes that have surged by 56%.

In his recent post on X, pseudonymous analyst Dave the Wave suggested that BTC could revisit the “buy zone” of his logarithmic growth curve (LGC) model before it finds a local bottom. Built to identify longer-term cycle lows and highs by design, the LGC model filters out short-term volatility.

According to Dave the Wave, BTC may replicate its early-2017 price behavior, which saw a 40% correction prior to a parabolic surge. “A similar 40% drawdown just N of the 0.38 Fib would see $44,000… with BTC price back to the trendline and the LGC buy zone,” he stated.

Bitcoin Short-Term Pain to Lead to Long-Term GainsEmphasizing how the short-term Bitcoin price correction could lead to long-term gains, the pseudonymous analyst believes that the drawdown would pave the way for a 400% rally in the next bull run, pushing BTC price to $220,000 by the end of 2025. “Short-term BTC pain, long-term gain,” noted the analyst.

Indicating how Bitcoin could gain significantly with the declining power of USD, market analysts have also been predicting that Bitcoin could gain massively, as reported by Crypto News Flash.

Emphasizing how downside volatility is an inherent aspect of a Bitcoin bull market, the trader noted, “BTC’ers got to take the good with the bad… still technically in a bull market… Though one might be confident of the final victory, there can also be a hammering along the way.”

Bitcoin Options Traders Increasing Downside BetsIndicating a growing demand for downside protection among Bitcoin traders is the recent distribution of Bitcoin options open interest.

According to data from derivatives platform Deribit, the put-call ratio for Bitcoin options has surged ahead of this week Friday's expiry.

A ratio above one indicates that there are significantly more put options than call options, currently trading for Bitcoin, indicating a bearish market sentiment.

According to Deribit data, the largest cluster of options open interest for Friday's expiry are puts at a strike price of $58,000, with substantial concentrations of puts also at the $52,000 and $48,000 strike prices, as reported by CNF.

In its report on Monday, the ETC Group noted: “An increase in bitcoin options open interest is largely driven by an increase in relative put open interest, consistent with the asset’s recent price correction, as bitcoin options traders increase their downside bets and hedges. A spike in put-call volume ratios as well as one-month 25-delta option skew signaled a significant increase in demand for downside protection.”

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