Why BTC crashed to $60,000 today

The price of Bitcoin is currently on the decline due to the possibility of war breaking out in the Middle East. The loss of important levels could lead to further declines in the short term.

technical analysis

Written by Edris Derakhshi (TradingRage)

daily chart

In the daily time frame, BTC price has fallen below the key $64,000 mark and the 200-day moving average located around the same price mark. Investors are hoping this decline is a temporary pullback, with the $60,000 support level currently holding.

However, the RSI is also just below 50%, with momentum shifting to the bearish side, leaving a possibility of a fall towards $56,000.

4 hour chart

The 4-hour chart shows a clear bearish shift in market structure from a classic price action perspective. The market decisively broke the key bullish trend line to the downside. However, the RSI also strongly indicates an oversold condition, so the price rebounded from the $60,000 level.

On the other hand, a full rebound is still unlikely as market structure suggests a deeper correction toward the $57,000 level is likely. Of course, this scenario will fail if the price somehow quickly crosses the $64,000 level.

On-chain analysis

Written by Edris Derakhshi (TradingRage)

Bitcoin open interest

Although Bitcoin price has fallen in recent days, future market sentiment indicators remain overheated.

This chart shows BTC open interest and shows the number of open perpetual futures positions, both bullish and bearish.

The minimal decline in open interest indicates that a prolonged liquidation cascade has not yet occurred, as the recent decline suggests. If the price falls further, a capitulation event is very likely to occur, leading to a rapid market crash and potentially pushing the price further down towards the $50,000 area.