The cryptocurrency market is facing an extreme bear market, with the global market capitalization dropping by nearly 4%. Moreover, trading volumes have also dropped significantly, indicating a drop in trading activity. One of the main reasons could be the Mt. Gox distribution, with an influx of over 50,000 BTC in circulation. However, while creditors initially appeared to hold on to their tokens, the increase in the sale volume indicates mixed feelings.
The repayment phase has just begun, but will BTC price eventually reach $60,000?
While Bitcoin prices are falling, ETF inflows are positive, hitting a record high of $485 million. Therefore, despite the growing bear market, the crypto bull market remains a possibility. In the short term, BTC price appears to have achieved a retracement and may be poised for a small bounce.
BTC price was trading within the ascending wedge, hence a nominal pullback was expected. As the bearish movement continues, the sellers are expected to get squeezed and the downtrend may continue for some time. The $63,550 level seems crucial as the trend reversed after reaching this zone. Hence, a pullback seems imminent as the bulls entered when the level dropped below $63,500 and the RSI triggered a bullish divergence.
Conversely, as the RSI remains above the lower threshold, the possibility of forming another lower high is increasing. This could push the price through the provisional support, in which case the 100-day and 200-day moving averages at $62,743 and $61,743 could act as strong support. However, if the bulls fail to sustain these support levels, we expect Bitcoin price to drop below $60,000 and in extreme bearish cases to test the monthly lows around $59,200.
Therefore, the next few days could be very important for Bitcoin (BTC) price and may determine the token's next course of action.
