Well, if you thought the worst was over for Bitcoin this is going to disappoint you greatly.
Recently, Germany sold over $3 billion worth of Bitcoin, causing a market panic that pushed BTC prices down to $53,000. Just as the market began to recover, the threat of Mt. Gox repayments emerged, adding more uncertainty. Needless to say, investors are on edge.
What does the future hold?
The German government seized around 50,000 BTC from a movie piracy website that had been active since late 2013. Tron founder Justin Sun offered to buy these Bitcoins, but the government chose to sell them on the open market. This decision had a significant impact, driving BTC prices down to $53,000. Once the sell-off concluded, the market began a slow recovery.
However, the Mt. Gox repayments posed a new threat.
On June 24, the court-appointed trustee for Mt. Gox announced they were ready to begin repayments. Mt. Gox went bankrupt in 2014, leaving investors waiting nearly a decade to reclaim their investments. Now, the long-awaited repayments are finally happening, and the potential market impact is enormous.
The repayment process threatens to destabilize BTC prices further. Bitcoin had climbed to $68,000, but the movement of funds from Mt. Gox caused another sharp decline. According to Arkham, Mt. Gox transferred BTC worth $2.85 billion from a cold wallet to one of their wallets, with plans to distribute these funds across four Bitstamp addresses before delivering them to investors.
The Bitcoin market has been heavily influenced by these recent events, with a significant amount of red on the charts. Data from Coinglass reveals a bearish sentiment among traders, who have opened more short positions in the past 24 hours. This indicates a lack of confidence in BTC’s ability to rebound. In the last eight hours alone, traders liquidated over $200 million in both short and long trades.
The price has dropped below the 20, 50, and 100 moving averages (MAs) and is currently supported only by the MA200. An impending death cross between the MA20 and MA100 signals further potential declines. Should this occur, the MA200 may not withstand the bearish pressure, leading to a drop to $65,400, a minor support level.
If this support level fails, BTC could fall further to a significant support zone around $63,000. Currently, BTC is fluctuating between the 0.786 Fibonacci level and the MA200 on the hourly chart, with a long journey ahead to reclaim the $68,000 mark.
We are witnessing a mini bear market within a broader bull market, presenting both a fearful time and a potential opportunity for investors.
Also Read : Bitcoin Cash Price Prediction 2024 – 2030: Is Bitcoin Cash The Best Investment for 2024?
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