Bitcoin Price Outlook: Can BTC Hold $60,000 Support Against Potential $40,000 Flash Crash?
Arslan Butt
Updated: June 29, 2024, 18:17 EDT
|
3 min read
Bitcoin Price Forecast
Bitcoin’s price teeters on a critical edge, with the pivotal support at $60,000 serving as a bulwark against a possible plummet to $40,000 in a flash crash.
Despite a weakening US dollar and anticipation of Federal Reserve rate cuts, Bitcoin continues its descent, spurred by declining demand and critical commentary from notable figures such as Peter Schiff.
This raises a crucial query in Bitcoin price prediction: Will the prevailing bearish momentum trigger a significant market correction, or can Bitcoin rebound from this decisive juncture?
Schiff Issues Warning on Bitcoin’s Weak Performance
Peter Schiff, a renowned skeptic of Bitcoin, expresses apprehension about its recent performance.
Q2 Performance Dip:
Bitcoin declined over 15%, while gold saw a 4% increase.
Investor Alert:
Schiff advises caution to those who switched from gold to Bitcoin ETFs, citing potential for further losses.
Bitcoin’s recent drop of 14% from its yearly peak to $60,800 adds weight to Schiff’s concerns. Although analysts observe an overall upward trend, reduced demand (23,000 Bitcoin outflow last month) raises alarms.
Schiff’s remarks, combined with decreased demand, influence current market sentiment and suggest possible downside risks.
Bitcoin’s Price Decline: Is Diminishing Demand Responsible?
CryptoQuant analyst Julio Moreno attributes Bitcoin’s recent price correction to a notable decline in demand, highlighting a key metric:
Inactive Supply Outflow:
23,000 Bitcoins, dormant for over a year, were recently sold, indicating reduced investor interest.
This influx of supply, coupled with inadequate buying activity, drives prices downward. Factors like overall market sentiment and the recent introduction of US Bitcoin ETFs further complicate the situation.
Moreno’s analysis underscores the pivotal role of demand in shaping Bitcoin’s market dynamics. The pressing question now is whether this trend will persist or if renewed demand will emerge to stabilize and potentially elevate Bitcoin’s price.
Mixed Economic Signals: A Tug-of-War between Bitcoin and the US Dollar
Recent US economic indicators present a nuanced scenario:
Fed Caution:
Despite a weakening US dollar and growing expectations of rate cuts in 2024, Federal Reserve officials maintain caution regarding the economy’s future.
Stable Inflation:
May’s US PCE data indicates steady inflation, with a slight improvement in consumer sentiment in June.
While the anticipation of a September rate cut weakens the US dollar, Bitcoin has failed to capitalize on this trend, continuing its downward trajectory.
Bitcoin Price Prediction
As of June 30, 2024, Bitcoin (BTC) trades at $60,686, showing a bearish inclination in the 4-hour chart analysis for Bitcoin price prediction. The cryptocurrency exhibits a bearish bias, confined within a descending triangle pattern.
The Relative Strength Index (RSI) stands at 42.82, signaling oversold conditions and hinting at a potential price recovery.
However, the 50-day Exponential Moving Average (EMA) at $62,231 acts as a formidable resistance level, limiting Bitcoin’s upward mobility.
Key support levels to monitor are $59,922 and $58,430. A breach below $59,922 could indicate further declines.
Conversely, surpassing the $62,231 resistance level would nullify the bearish outlook, potentially paving the way for a bullish reversal.
Traders should vigilantly track price movements around these critical levels for potential trading opportunities.
