What is causing the decline in Bitcoin? Will it persist? What level of support is needed for BTC?
Bitcoin, the leading cryptocurrency, recently hit its previous all-time high (ATH) of $69,000 before experiencing a decline. It has now reached the $59,000 level. Bitcoin has been fluctuating between $60,000 and $69,000, which has kept investors on edge.
Analysts from QCP Capital have provided an assessment on the ongoing decline. They noted that Bitcoin reached an ATH of $69,300 but quickly fell to $59,200 within a span of five hours. However, they highlighted that $60,000 has proven to be a strong support level for Bitcoin during this process.
The decline is said to be influenced by selling pressure resulting from purchases made primarily between September and December 2023 for both Bitcoin and Ethereum. Despite this correction, analysts do not anticipate the situation to persist for an extended period.
The decline in Bitcoin presented an opportunity for some investors, who quickly and aggressively bought during the dip. Funding in Bitcoin has returned to reasonable levels, and it is expected that the ETH/BTC trading pair will perform well once the ETH spot ETF narrative gains traction.
Interestingly, even with the significant liquidation of leveraged positions, Bitcoin futures are still trading at a premium to spot prices. This makes cash and current trading more attractive. Some spot investors have taken advantage of peak levels to secure risk-free returns for the remainder of 2024, but analysts do not believe this trend will last long.
At the time of writing, Bitcoin is trading at $65,800. It is important to note that this information should not be considered investment advice.