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Bitcoin Falls Below $60,000! Analysis for July 9, 2024
As Bitcoin consolidated above $60,000, selling pressure pushed BTC price below its support. Let’s take a look at the future outlook of BTC price.
Bitcoin (BTC) Price Situation
After a slight bounce to $60,000, Bitcoin encountered selling pressure, causing the cryptocurrency to drop below its support zone at $61,000, then below its previous daily support. The price of Bitcoin then suffered a decline of about 16%. It should be noted that this decline was fueled by FUD caused by the Bitcoin sales by German and US governments as well as the beginning of the Bitcoin distribution from MTGoxIt was at $53,500 that the cryptocurrency sparked buying interest, allowing it to replenish its previous support around $56,500.
At the time of writing, the Bitcoin Price is trading around $57,300. Although the short-term structure of BTC is bearish, its medium-long term trend remains bullish. However, the recent fluctuations of Bitcoin have caused its price to fall below the 50-day and 200-day moving averages, naturally casting doubts on the continuation of the latter. On the price dynamics side, it can be observed that it continues to decline, as evidenced by the price of BTC itself and oscillators. Therefore, it is possible to predict the next support identified around $52,000.
The current technical analysis was conducted in collaboration with Elie FT, a passionate investor and trader in the cryptocurrency market. Today he is an instructor at Family businessa community of thousands of proprietary traders active since 2017. There you will find Live, educational content and mutual support on the financial markets in a professional and friendly atmosphere.
Focus on Derivatives (BTCUSDT)
Open interest in Bitcoin perpetual contracts has fallen, as expected, along with the price of its underlying asset. This indicates a reduction in speculative participation in BTC/USDT perpetual contracts. This decline was accompanied by over $46 million in long position liquidations, indicating a capitulation of buyers during this decline. That said, the funding rate has remained positive throughout these fluctuations, showing that most speculators are biased towards buying.
Recently, it can be observed that the BTC/USDT price is slightly regaining strength, causing liquidations of short positions. In addition, it is noted that the open interest in Bitcoin perpetual contracts has not increased significantly. This phenomenon suggests, at the moment, a lack of confidence in continuing this movement, or even the appearance of selling conviction by speculators.
The liquidation heat map of the past few months indicates that BTC/USDT has attracted buying interest once it reached the thin liquidation zone around $56,000. This zone seems to be defended for now. Currently, the most significant liquidation zones of the past six months are located on both sides of the Bitcoin price. Above the current price, we can see the $64,000 zone. However, the most obvious one is further away, located at $72,300. Below the current price, we can see the very obvious zone around $50,000. If the market approaches these levels, we could see a huge order activation, potentially increasing the cryptocurrency’s volatility. Therefore, these zones are important points of interest for investors.
Bitcoin (BTC) Price Hypothesis
- As long as the price of Bitcoin can stay above $53,500, we can expect BTC to return above $58,500. The next resistance to consider, if the bullish move continues, would be the $60,000 to $61,000 zone. Higher up, we can highlight $63,800. At this point, this would represent an increase of about 12%.
- If the price of Bitcoin does not stay above $53,500, a support of buyer interest could be considered around $51,800. The next level to consider, if the bearish movement continues, would be around $50,500. Further down, we can highlight the price range between $49,200 and $48,200. At this stage, this would represent a decline of close to 15%.
Conclusion
Despite a medium-long term bullish trend, Bitcoin is facing selling pressure that has recently led to a significant decline, fueled by external factors. Current price dynamics indicate a possible continuation of the decline towards the next identified support. However, it will be crucial to carefully observe the price reaction to various key levels to confirm or invalidate current hypotheses. It is also important to remain vigilant for potential market “fake outs” and “squeezes” in each scenario. Finally, remember that these analyses are based solely on technical criteria and cryptocurrency prices can also evolve rapidly based on other more fundamental factors.
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