Bitcoin Bull Run Stumbles: Will $50,000 Hold?

• Bitcoin’s value has undergone a recent and massive drop.
• Data analysis has revealed hidden buying zones and resistance strongholds.
• Technical analysis has provided valuable clues about the next price direction.

The sentiment surrounding Bitcoin (BTC) has shifted dramatically in recent weeks. After trading within a four-month range, the world’s leading cryptocurrency has broken down, raising concerns among investors. This article explores key support and resistance levels that could determine Bitcoin’s future trajectory.

Key Bitcoin Levels to Watch

Currently, Bitcoin finds itself at a crossroads, hovering around $56,825. This price point sits squarely between two significant psychological levels: $50,000 and $60,000. The breakdown from the previous trading range casts a shadow over the $60,000 resistance, which now becomes even more crucial to regain bullish momentum.

On the downside, support appears near the 365-day exponential moving average (365-EMA) currently at $50,589. This level represents a significant year-over-year benchmark. Additionally, the 30-day EMA sits at $62,695, acting as a potential hurdle for any near-term price surges.

Looking beyond traditional technical indicators, on-chain data provides valuable insights. Data from IntoTheBlock , retrieved on July 6, reveals another layer of support and resistance levels to consider.

Bitcoin In/Out of the Money Around Price. Source: IntoTheBlock

The “In/Out of the Money Around Price” metric suggests a significant buying zone between $54,810 and $56,478. This area represents the largest trade volume, with an average price of $55,594. Notably, over 747,000 addresses purchased more than 569,720 BTC within this range, indicating they are currently in profit. 

Breaking Down Bitcoin’s Price Hurdles

This concentration of buying also suggests a potential price drop if Bitcoin falls below this level, as these investors may look to sell to avoid losses. Interestingly, the data also highlights strong resistance on the upside. 

The first hurdle lies between $59,885 and $61,553, with a combined volume exceeding 1 million addresses and 584,250 BTC. This resistance zone extends all the way up to $65,000, suggesting potential difficulty for any significant price increases.

In conclusion, several key support and resistance levels will likely shape Bitcoin’s price movement in the coming days. These include $50,000, $55,594, $60,000, $62,700, and $65,000. 

While the resistance levels appear more robust, indicating a potential downside breakout, it’s crucial to remember the inherent volatility of cryptocurrencies. Technical indicators and on-chain data offer valuable insights but are not guarantees of future price movements.

On the Flipside

• A strong surge in buying pressure could push Bitcoin above resistance levels, invalidating the current bearish outlook.
• Even if the price falls below $50,000, it might not be a long-term decline. Bitcoin has bounced back from previous drops below this level.

Why This Matters

This breakdown below the previous trading range creates a critical juncture for Bitcoin. Reclaiming $60,000 is crucial to restore bullish momentum, while a drop below $50,000 could trigger significant selling pressure from investors who bought between $54,810 and $56,478. This price action will likely set the tone for the broader cryptocurrency market in the near future.

If you found this article interesting, you’ll probably like this piece on Bitcoin ETFs seeing significant inflows amidst BTC’s resurgence above $56K:
Bitcoin ETFs See $143.1M Inflows as BTC Regains $56K

For more insights into the recent downturn in Bitcoin’s price below $55K and its impact on the broader crypto market, check out this article:
Bitcoin’s $55K Misery Piles onto Altcoins as Losses Drag