What to Expect if Bitcoin Falls Below 57000

Byadmin

Jun 25, 2024
What to Expect if Bitcoin Falls Below 57000What to Expect if Bitcoin Falls Below 57000

The recent drop in Bitcoin to $57,000 was surprising after its sharp decline below $65,000. In this new reality, the market must react in some way. Here are three potential scenarios if BTC breaks below the critical level of $57,000.

Weakening of the 200 EMA as support
If Bitcoin falls below $57,000, the 200-day exponential moving average (EMA) will no longer serve as a support level. This is a key technical indicator for assessing the overall trend. The loss of this support could push BTC into bear territory and potentially reinforce selling. As traders and investors lose confidence in Bitcoin’s ability to hold key support levels, this could lead to further price declines.

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Rise in liquidations
Many buyers may attempt to use the decline to purchase BTC at low prices around the $56,000 mark. However, if the cryptocurrency cannot hold this level, more liquidations may occur. This could trigger additional sell orders due to the activation of buyers’ stop losses, further lowering the price. Increased selling pressure could make it difficult to stabilize the price of Bitcoin, accelerating the decline.

Potential sales and market impasse
If Bitcoin falls below $57,000, some institutional sales may stop due to a lack of liquidity. This could lead to a horizontal market, with the leading cryptocurrency trading between $55,000 and $60,000 as buyers and sellers wait for more favorable conditions. Conversely, if institutional investors continue to sell, BTC could fall to $50,000. Institutional investors, holding a significant portion of the market, have a significant impact on the price of Bitcoin. Prolonged sales could hinder the short-term recovery of BTC, potentially leading to an extended bear market.

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