Bitcoin failed to test $58k support, hinting at a further drop in price, but there was hope for a trend reversal.
- BTC was down by more than 10% in the last seven days. A few metrics suggested that there were chances of a price uptick.
Bitcoin [BTC] witnessed a major price correction in the recent past, sparking fear among investors. The scenario might get even worse as BTC fails to test a key support level. However, if history is to be believed, then this might not be the end of BTC’s bull rally.
Bitcoin goes under $58k
According to CoinMarketCap, BTC witnessed a double-digit price drop last week as its value plummeted by 10%. In the last 24 hours alone, the king of cryptos’ price dropped by 4.5%.
At the time of writing, BTC was trading at $57,440.15 with a market capitalization of over $1.13 trillion.
The considerable decline in price also had a negative impact on Bitcoin’s dominance. As per CoinStats’ data, BTC’s dominance dropped by 1.7% in the last 24 hours, as it had a value of 50.2%.
Source: CoinStats
World of Charts, a popular crypto analyst, posted a tweet highlighting how BTC’s price was moving inside a parallel channel. If the coin tested the pattern, then its price could have once again touched $70k.
However, this wasn’t the case, as Bitcoin’s value fell below the $58k support.
Therefore, AMBCrypto checked Hyblock Capital’s data to look for its next support level. We found that if the downtrend continues, BTC might find support near the $56.5k to $55k price range, as liquidation would rise substantially at that level.
If it fails to test that support, then investors might as well witness BTC dropping to $51k in the coming days or weeks.
Conversely, if a trend reversal happens and the coin’s price moves northward, BTC might face strong resistance at $65k.
Source: Hyblock Capital
This is better news
In the meantime, Elja, a popular crypto analyst and influencer, posted a tweet mentioning that BTC was mimicking its 2020 price action. As per the tweet, BTC’s was following the same pattern as the 2020 rally, suggesting that BTC’s latest bull run is far from getting over.
In fact, AMBCrypto’s analysis of CryptoQuant’s data revealed quite a few metrics that hinted at a trend reversal. For instance, BTC’s net deposit on exchanges was low compared to the last seven-day average.
BTC’s aSORP was green, meaning that more investors were selling at a loss. In the middle of a bear market, it can indicate a market bottom.
Read Bitcoin’s [BTC] Price Prediction 2024-2025
Additionally, its binary CDD also suggested that long-term holders’ movements in the last 7 days were lower than average, indicating their motive to hold.
If these indicators are to be believed, then Bitcoin might be setting up the stage for a price uptick.
Source: CryptoQuant
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