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What will happen to bitcoin after it returns to $60,000 this week
Bitcoin is once again testing a key level after the cryptocurrency fell below $60,000 this week for the first time since May 3. On Tuesday afternoon, it was trading above $61,000, about 17% below its March record of $73,797.68, according to Coin Metrics. Chart analysts, however, see no buy signals and say another decline could occur, which would be more “damaging” at current levels. “The moderation since March continues and trading can be considered under pressure below the $66,000 resistance,” the cryptocurrency’s 50-day moving average, Oppenheimer analyst Ari Wald said. “There is key support at $57,500, the 200-day average, down to $56,500, the May low, and a break to the downside would be damaging.” Bitcoin has largely remained stuck in a tight range between $60,000 and $70,000 since mid-March, when it hit its all-time high. It currently suffers from a lack of short-term catalysts, low demand for bitcoin exchange-traded funds, and miners selling bitcoin. BTC.CM=6 Million Bitcoin Mountain This Year If Bitcoin fails to hold $57,000, Wald added, $49,000 would become the next key bearish level. For David Keller, chief market strategist at StockCharts.com, bitcoin’s next downside levels are similarly around $58,000, with a potential downside between $50,000 and $52,000. Keller noted that buyers often come in around $60,000. Furthermore, he said, it is reasonable to expect bitcoin’s price to bounce even higher since the cryptocurrency often finds support on large, round numbers. RJ O’Brien’s Tom Fitzpatrick has identified major support for bitcoin at $56,527 and a potential double-top neckline, an M-shaped bearish chart formation composed of two peaks on either side of a moderate decline. “Below there would be at least another 22% decline… and a possibility of up to 29%,” he said in a note to investors. Wald however highlighted the strength of the current $57,500 support level and the 200-day moving average. “The double top [is] not completed until the neckline is breached,” he said. Until then, “I am always on the side of the trend, which means I assume the 200-day rising average holds. The bullish action in the NASDAQ-100 suggests that risk tolerance also remains positive.” For the month, bitcoin fell nearly 10%. In early June, it briefly touched the $71,000 level, but since then is constantly decreasing.