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- The BTC price has fallen below the 55-day support level at $27,000, resulting in a 7% correction and the liquidation of $100 million in long BTC futures contracts.
- Despite the decline, Bitcoin’s margin and futures markets demonstrate resilience during this downturn.
- The market’s strength amid the correction fosters optimism for a possible recovery toward the $28,000 mark.
Today’s analysis of Bitcoin’s price reveals that the leading cryptocurrency has been on a downward trajectory since experiencing a 12% price drop from a peak of $29,865 on May 6. The price has fallen to as low as $26,166.87 on various exchanges, reflecting a 3.16% decrease in the past 24 hours.
BTC price action in the last 24 hours: Coinmarketcap
The ongoing decline in Bitcoin’s price coincides with a significant influx of investment into meme-themed digital currencies such as Pepe Token, Dogecoin, and Shiba Inu. These assets are gaining traction as investors shift their focus away from Bitcoin, leading some to speculate whether the current crypto market is experiencing a bubble.
Even with Bitcoin’s drop below $27,000 and the resulting liquidation of $100 million, margin traders are not adopting a bearish stance. This resilience can be attributed to various factors. Firstly, there has been an increase in regulatory scrutiny in the United States, highlighted by Bitcoin miner Marathon Digital receiving a subpoena from the SEC. This regulatory ambiguity complicates the market landscape but does not appear to dissuade margin traders from holding their positions.
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BTC/USD Technical Analysis on a 4-Hour Chart: Bitcoin Forms a Falling Wedge
The BTC/USD pair is trading bearishly beneath the $27,200 threshold, although a bullish continuation pattern has emerged. The 4-hour chart indicates that Bitcoin has created a falling wedge pattern, suggesting a potential reversal if it can surpass the upper trendline of the wedge at $28,500.
BTC/USD technical chart: TradingView
Bitcoin is currently priced at $26,295.69 after dropping below the SMA50 and SMA200. Should Bitcoin regain the crucial support level around $27,000, it may form an inverted head and shoulders pattern. This would indicate a potential upward trend reversal, enabling Bitcoin to break free from the wedge pattern and test resistance at $28,500.
Looking forward, the current cryptocurrency market is in a state of flux, with regulatory uncertainties and a weak dollar contributing to an unpredictable environment. Nevertheless, Bitcoin margin traders continue to show resilience despite these challenges.
Professional traders have maintained their leveraged long positions and remain hopeful about Bitcoin’s ability to recover from its recent dip below $28,000. Technical analysis indicates that a breakout above $28,500 could be on the horizon for Bitcoin, although the digital asset must first reclaim $27,000 for this scenario to become more plausible.
