Bitcoin (BTC) Price Drop Accelerates as Analysts Project Further Losses

Technical indicators suggest that the maiden cryptocurrency is flashing a series of concerning signals pointing to a significant decline in value.

Bitcoin price dropped as low as $59,700 on some exchanges during the last 24 hours, marking the first time that BTC price has slipped below the $60,000 level since August 2.

The price drop comes amid technical indicators that are suggesting a significant decline in value for the flagship cryptocurrency.

Crypto trading expert Alan Santana noted in a TradingView post on August 4 that Bitcoin is likely to see much lower price levels before it can expect new highs or substantial growth.

One of Santana's most alarming indicators is the bearish divergence on Bitcoin's weekly Relative Strength Index (RSI). The RSI has made a lower high in 2024 than in 2021, despite Bitcoin's price showing higher highs during the same period.

This divergence between price action and RSI is a classic bearish signal, suggesting that the underlying momentum driving Bitcoin's price upward has weakened considerably.

Adding to the bearish outlook, Bitcoin's weekly RSI is trending downward, with a reading of 50.6.

This is significant as it indicates that the long-term RSI is about to turn bearish for the first time since August 2023.

More notably, coming from a major high, this bearish shift in the RSI is the first since November 2021. According to the expert, such a development typically precedes a prolonged downturn, reflecting a loss of bullish momentum and the potential for substantial price declines.

“Doom signal? It is only doom if you are not prepared. <…> On top of the bearish divergence we have Bitcoin's weekly RSI trending full down with a reading of 50.6. <…> This, and other signals, is telling us that there is room for lower prices; much lower, before we experience new highs and boom growth,” the expert stated.

Bitcoin price key levels to watch

At the moment, Bitcoin's price appears to form a descending triangle pattern, a bearish formation that often precedes further declines. Critical support levels to watch include the 0.618 Fibonacci retracement level around $37,795 and the 200-week moving average, which could act as potential downside targets.

Additionally, decreasing volume on upward price movements suggests weakening buying interest, adding to the bearish case.

Meanwhile, another analyst, Rekt Capital, noted in an X post on August 3 that the current Bitcoin RSI readings will likely dictate the extent of additional downside.

“Bitcoin is getting really close to this RSI Higher Low trendline. It will dictate the extent of additional downside,” the expert said.

It's worth noting that Bitcoin also took a hit following troubling signs in the United States economy. Investors will be looking at strategies implemented by the Federal Reserve to rescue the economy, as this will dictate Bitcoin's trajectory.

Bitcoin price analysis

At press time, Bitcoin price is trading at $60,868, having plunged 1.5% in the last 24 hours. On the weekly timeframe, Bitcoin is down over 10%.

Overall, Bitcoin looks bearish, and the bulls' ability to sustain the price above the $60,000 support will be key to reducing any further losses.