The recent price performance of Bitcoin has left the crypto market disappointed, as the leading cryptocurrency has been facing challenges once again. This downtrend was not limited to Bitcoin alone, as many other large-cap assets also suffered significant losses. Recent price action data indicates that Bitcoin’s price might still be vulnerable to further downside in the near future.
Potential for Further Decline
According to a new report from blockchain intelligence firm CryptoQuant, Bitcoin could potentially drop to the $60,000 price level after losing a crucial support level. The premier cryptocurrency dipped below $65,000 on June 18 for the first time in over a month. While it quickly rebounded to $66,000 by Thursday, it later fell to as low as $63,500 on June 21. The price is now trading below the critical support level of $65,800, which could lead to an 8-12% correction towards $60,000.
On-Chain Realized Price Analysis
CryptoQuant’s analysis is based on the on-chain realized price of Bitcoin, which currently sits below the $65,800 level. This price serves as a crucial support level, and a break below it often signals an impending decline in the Bitcoin price. Whenever Bitcoin crosses beneath the on-chain realized price, it tends to undergo an 8-12% correction, hence the projected $60,000 price target.
The on-chain metrics of Bitcoin also support this bearish outlook, as there has been a decrease in traders’ demand for the cryptocurrency. Short-term holders are reducing their BTC holdings instead of purchasing more, while large investors (whales) are not demonstrating the typical bullish momentum. Additionally, stablecoin liquidity has been declining, which is crucial for initiating price rallies in the crypto market. The growth in Tether USD’s market capitalization has slowed significantly in recent months, hindering the potential for a Bitcoin bull run.
As of now, Bitcoin is trading around $64,000 with a 1.2% decline in the last 24 hours. Over the past two weeks, the cryptocurrency has lost almost 8% of its value, according to data from CoinGecko. This downward trend highlights the ongoing challenges faced by Bitcoin in the current market environment.
The recent struggles of Bitcoin’s price performance and market indicators point towards a potential further decline in the near future. Traders and investors should carefully monitor the on-chain metrics and market dynamics to make informed decisions in such uncertain times.
