Will July 2024 be the Next May 2021? Has the Bear Market Begun? Will BTC Price Collapse Below $50,000?

The crypto markets are bleeding as the rounds of nearly 47,228 BTCs from the Mt. Gox cold wallet have been transferred in preparation for a $9 billion payout. The market participants who were hopeful despite the BTC price dropping below $60,000, now appear to be in panic & fear, blame & frustration, saltiness & hate, and sarcasm & humour. 

Along with the Mt. Gox terror, the German government has also transferred 1300 BTC to CEX, which holds over 40,000 BTC. Therefore, they are both collectively contributing to the BTC price decline that marked the lows below $53,500. After witnessing the second-largest liquidation in its history, first after the FTX collapse, the market participants may perceive the current situation to be similar to that of May 2021. 

The crypto markets collapsed in May 2021 following an SNL event hosted by Tesla CEO, Elon Musk which triggered a huge sell-off with DOGE price and later spread across the markets. However, the historical pattern suggests the current correction has already happened in the recent past and hence the possibility of a reversal looms over the markets. 

Back in August 2023, BTC price slipped heavily from the consolidation zone around $30,000 and dropped by more than 15% to mark the lows close to $25,000. The RSI also dropped to ground levels and took over a week to rise back to positive range. However, the price maintained an ascending consolidation until the beginning of Q3 followed by a strong ascending trend to mark a new ATH. 

The trade set-up looks similar to the previous one and hence the BTC price is expected to mark the lows close to $50,000 or slightly below the levels in the coming days. Once the sellers or the weak traders are whipped out, the token is expected to begin with a recovery by rising back above $50,000 and holding the support strong until a fresh influx of buying volume hits back into the markets. 

Collectively, the historical chart patterns suggest the Bitcoin price continues to remain within a bullish track, provided the trend reverses before reaching crucial support.