Bitcoin’s price is contending with fears related to the Mt. Gox repayment plan and various macroeconomic factors, with some analysts predicting potential drops below $50,000 in the coming weeks. Presently, Bitcoin (BTC) is valued at $56,323, marking a 15% decrease in the first week of July due to several unfavourable events.
According to the latest crypto update, the repayment of 140,000 BTC to Mt. Gox creditors and the German government’s persistent BTC liquidations are major contributors to the Bitcoin price crash.
Matthew Hyland’s Bearish Outlook
Independent market analyst Matthew Hyland forecasts that Bitcoin will fall below $38,000. In his post on July 8. He said, “Another red weekly candle would likely push the RSI lower, which would then give an opportunity for Bullish Divergence.”
He observed that the probability of Bitcoin re-entering the same range is low. This outlook is supported by Bitcoin’s weekly relative strength index (RSI) reading of around 45, indicating that neither buyers nor sellers are in control. The ongoing market downtrend suggests that the RSI has more room to decline until it hits the oversold threshold of 30.
Stockmoney Lizards’ Analysis Hints on Another Bitcoin Price Crash
Pseudonymous market analyst Stockmoney Lizards also expects a further Bitcoin price crash, targeting a drop to around $50,000. His analysis is based on the “Bat Harmonic” pattern, which starts with an initial price move (XA), followed by a retracement (AB), another move (BC), and a final leg (CD) that extends to 88.6% of the XA leg. Point D, which coincides with the $50,000 level, is where traders expect a reversal, often confirmed by additional signals like candlestick patterns or volume. “We are waiting for another liquidity flush, potentially with a long wick below 50k to establish 52k support,” Stockmoney Lizards explains, adding:
“Daily RSI etc are already oversold, however, we believe there is still some more downside. Ideally, we consolidate at 52k, forming a bullish divergence with high volume which would be the reversal signal for us.”
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Macroeconomic Prospects for BTC Price
Supportive economic data from the United States, especially increased Wall Street bets on a potential interest rate cut in September, have helped mitigate Bitcoin’s bearish outlook during its ongoing correction cycle. As of July 8, futures rate traders increased their expectations for a 25 basis point rate cut in September to approximately 67.3%, up from 46.6% a month ago. This shift toward a more dovish outlook gained momentum following disappointing U.S. jobs data released on June 5, which triggered a sharp decline in short-term yields.
Is a Rebound Expected After the Bitcoin Price Crash?
Bitcoin has rebounded from the losses incurred due to the Mt. Gox repayment and German government-led sales. It has risen 7% from its local low of $53,550, established on June 5. These gains coincide with $398 million worth of weekly inflows into Bitcoin-based investment funds, including exchange-traded funds (ETF).
James Butterfill, a researcher at asset management firm CoinShares, noted, “Digital asset investment products saw inflows totalling US$441 million, with recent price weakness prompted by Mt Gox and the German Government selling pressure likely being seen as a buying opportunity.”
BTC is currently aiming for a sharp rebound toward its multi-month horizontal trendline resistance of around $71,500 in Q3 2024. On the other hand, a drop below the ascending trendline support risks pushing the price toward its 0.786 Fibonacci retracement level at around $51,500, aligning with Stockmoney Lizards’ analysis.
Conclusion: Bitcoin Price Crash, Ups and Downs Pose a Risk
The cryptocurrency market remains unpredictable, with Bitcoin and Ethereum (BTC ETH) prices facing significant challenges. The Bitcoin price crash is influenced by several factors, including the Mt. Gox repayment plan, German liquidations, and macroeconomic conditions. Analysts like Matthew Hyland and Stockmoney Lizards offer different predictions, highlighting the market’s uncertainty. Supportive economic data and investment inflows provide some hope for recovery, but the risk of further declines remains. Investors should stay informed with The BIT Journal to navigate this dynamic market effectively.
The price predictions and financial analysis presented on this website are for informational purposes only and do not constitute financial, investment, or trading advice. While we strive to provide accurate and up-to-date information, the volatile nature of cryptocurrency markets means that prices can fluctuate significantly and unpredictably.
You should conduct your own research and consult with a qualified financial advisor before making any investment decisions. The Bit Journal does not guarantee the accuracy, completeness, or reliability of any information provided in the price predictions, and we will not be held liable for any losses incurred as a result of relying on this information.
Investing in cryptocurrencies carries risks, including the risk of significant losses. Always invest responsibly and within your means.
