Bitcoin (BTC) Price Fell Below $60,000 Support Level, but Later Rebounded

Prominent cryptocurrency analyst Willy Woo explained that the recent Bitcoin price correction has helped clear excess leverage in the market

Bitcoin (BTC) price, the world’s largest cryptocurrency, tumbled below the key $60,000 support level at $59,000 earlier today, later bouncing back above the level. Well-known cryptocurrency analyst Willy Woo said that the recent Bitcoin price correction has helped clear excess leverage in the market, but the flushing out process is not yet complete. Here are the details…

Bitcoin price benefited long positions

Bitcoin price dropped further on Monday, June 24, following the announcement of the Mt. Gox Bitcoin refund. Woo observed that the market began clearing out excess leverage, moving past the initial target of $62,500. Despite this, speculators continued adding new long positions, causing further liquidations in a slow motion long squeeze, bringing BTC to lows of $58,000 earlier today.

After that, BTC is not out of the woods, we just need to see how much speculation got cleared out of the system. Without purging futures open interest the system is not ready to move up.I do think there's a good chance we have price lows. https://t.co/CAGX7ir81c

Woo also noted that in addition to the liquidation squeeze, the post-halving Bitcoin miner capitulation is still in effect. As reported by us at Kriptokoin.com, Bitcoin miners were selling heavily to fund hardware upgrades as mining difficulty increased significantly, forcing the weakest miners to shut down their operations, leading to the liquidation.

BTC is expected to drop to 54,000 in the short term

Woo stated that technical indicators are now calling for a reversal in the Bitcoin price movement. Bitcoin moved down from the lows below $59,000, following Woo’s predictions and currently trading at $61,500. However, the analyst warned that Bitcoin is not completely in the clear just yet. The market has yet to realize how much speculative excess has been flushed out of the system so far. Without a substantial reduction in BTC futures open interest, the Bitcoin price will fail to rally sustainably.

Woo anticipates that Bitcoin could hit fresh lows and the next critical level will be at $54,000, where another round of liquidations will occur. A drop to this level will put BTC trading below the entry price point of short-term investors, usually putting it in a bear market. Woo also highlighted that this level acts as a key boundary between bullish and bearish market regimes and considering the current macro setup, a break below will be crucial.

The factors that will shape the future of Bitcoin

According to Ki Young Ju, Founder and CEO of CryptoQuant, three main buying liquidity channels are currently impacting Bitcoin’s price movements: fiat, stablecoins, and exchange-based ETFs. These factors are influencing the market trend and will continue to influence the cryptocurrency price movements throughout June. Recent statistics show that the stablecoin market cap is rising but is still relatively close to previous ATHs compared to the BTC market cap. Stablecoin exchange reserve ratio is also showing levels very similar to these ATHs, according to market analyst Ki Young Ju.

This suggests that stablecoins are already being utilized in buying liquidity and further large price movements might require larger inflows of stablecoins to spark another الكبير rally. At the same time, the Coinbase premium has been negative over the past week, which could be attributed to the overall market sentiment and a lack of strong fiat inflows to push the Bitcoin price higher.

To stay up to date with the latest breaking news, follow us on Twitter, Facebook, and Instagram. Join our Telegram and YouTube channel