Is Bitcoin Setting Up for Another Fall ?
After reaching historic highs in early 2023, Bitcoin appears poised for another correction.
Since its all-time high above $110,000 in June, Bitcoin has seen a significant decline, breaking below the $100,000 mark for the first time in six weeks. Analysts suggest that BTC could drop further, with short-term targets around $93,000 and a potential bottom at $74,000.
Indeed, Bitcoin is now walking a tightrope:
- Bitcoin’s price deviated 12% from its all-time highs on June 23, dropping below $100,000 for the first time since May 8.
- The 24-hour liquidation heatmap suggests a short-term target of $97,000, with a rounded top pattern indicating Bitcoin’s price could drop as low as $74,000.
The retreat in Bitcoin’s price comes amid a general market downturn, fueled by geopolitical uncertainties following U.S. strikes on nuclear sites in Iran. This massive sell-off has market participants questioning how far the price could decline.
Crypto liquidations in the past 24 hours reached $672 million, according to CoinGlass data. Bitcoin’s price wiped out over $238 million in long positions between June 22 and 23, underscoring market volatility.
Technical Analysis : Bearish Pattern Emerging ?
From a technical standpoint, Bitcoin’s price appears to have formed a rounded top or inverted U pattern on the daily chart. This pattern suggests further downside, with technical targets around $74,730.
Bulls are now focusing on defending the psychological level of $100,000. A drop below this could lead the price towards $93,000 or lower. A daily candle close below this level would confirm the bearish breakout of the rounded top formation.
Additionally, the Relative Strength Index (RSI) stands at 41 and has dropped from 64 on June 9, indicating that bearish momentum has strengthened in recent weeks.
Nevertheless, liquidity is key. Bitcoin holds a substantial liquidity zone between $97,880 and $95,200. In case of continued downside, this is the last line of defense for the bulls.
Otherwise, a drop below $92,000 may lead to $84,000 and potentially a new low.
Notably, the Woodies CCI has turned negative on the daily and 3-day charts, signaling that the bearish trend is still intact. The next 24 hours and what happens this Monday after the opening of the stock markets at 3:30 PM will be crucial.
With current geopolitical uncertainties and bearish technical signals, the future trajectory of Bitcoin’s price appears uncertain. Investors will need to stay vigilant and closely monitor market developments in the coming weeks, with the $74,730 level remaining a key technical target to watch closely.
