Bitcoin Price Recovers 4% Today Testing $57,000: Tides Could Turn Bullish According To Analysts
Bitcoin price recovers since Friday as analysts believe the sentiment could turn bullish. Did BTC reached its low?
Key Takeaways
- Bitcoin fell to $53,500, the lowest price level since February.
- Government sell offs contributed to Bitcoin’s month-long decline.
- Analysts remain bullish despite recent large transactions
Last Friday, July 5, the price of Bitcoin fell to a low of $53,500, its lowest point since February. However, it held above $55,000 over the weekend and increased to $58,000 today.
The decline was caused by negative news, including Mt. Gox repayments and the German Government selling BTC. Addresses associated with the US and German governments have moved over $737 million worth of Bitcoin to exchanges such as Coinbase, Bitstamp, and Kraken in the past two weeks. This activity has coincided with a month-long decline in Bitcoin’s price, increasing the selling pressure.
But despite this, the decline analysts outline that the impact of these large transactions could be limited, and with Bitcoin showing positive signs, the trend might shift to bullish soon.
Analysts Are Bullish
Ki Young Ju, CEO of CryptoQuant, believes the impact of government-related selloffs is overstated. CryptoQuant data shows significant Bitcoin inflows totaling over $224 billion since 2023, with only a small portion linked to government-seized assets, indicating a minor impact on the overall market.
The realized market cap, which considers the price at which each Bitcoin last moved, offers a clearer picture of Bitcoin’s value. Despite the largest correction since the 2022 low, Bitcoin isn’t out of trouble. For continued upward momentum, it needs to reach the $60,000 range.
Institutional interest could shape Bitcoin’s future, with Bitwise’s CIO predicting a 50% reduction in volatility due to increasing institutional investments. These large, long-term investments from institutions could stabilize the market, balancing out volatility from whale selloffs and government liquidations. As Bitcoin matures, its dynamics will likely be influenced more by institutional participation and less by individual large-scale transactions, suggesting a resilient market with sustained growth and reduced volatility.
BTC Price Analysis
After peaking at nearly $74,000, Bitcoin entered a descending channel. It broke out on May 17, climbing to $71,800 by May 21. Despite a fallback to $67,000 on May 31 and an attempt to regain momentum, it failed to surpass the $71,800 level again.
Following the second encounter with the $71,800 level on June 7, Bitcoin experienced a downturn. Two possible scenarios emerge: If Bitcoin bounces off the channel’s resistance and turns it into support, it may initiate the next bullish phase of a five-wave pattern, aiming to push past $78,000.
Alternatively, if Bitcoin falls back into the descending channel, it could signal a bearish trend. The rise from last Friday could indicate that the recovery started, with the daily chart RSI falling to 28% on July 5.
Zooming into the 4-hour chart, we can see that the price created a higher low today than on Friday. If it started a new five-wave impulse to the upside, an immediate rise should come, with the $63,100 area being its first target.
However, a failure to surpass $60,000 and a potential downturn afterward could lead to a breakout below the descending support. In that case, we would look at values around $44,000 for its next potential stopping point.
Mt. Gox’s $700M Bitcoin Transfer Marks First Major Activity in Weeks
