Bitcoin Price Analysis: 2 Targets for BTC Following the Crash Below $50K and Subsequent Bounce
After a significant downturn in the cryptocurrency market, Bitcoin has seen a sharp decline, breaking through the key support level of its previous major swing low of $53K.
This price movement indicates a possible shift towards a bearish market structure.Technical Analysis
A detailed examination of Bitcoin’s daily chart reveals a significant downturn driven by widespread fears of potential economic turmoil. Since Friday, increased selling pressure has led to a sharp decline in BTC’s price, causing it to break below the 200-day moving average at $61.1K and its prior major swing low at $53K.
This breakout is a strong bearish signal, suggesting a potential shift in market structure towards bearishness, as it marks a new lower low on the daily timeframe.
This movement indicates that sell-side liquidity, which was resting below the $53K level due to stop-loss orders from earlier long positions, has been activated, triggering a long-squeeze event.
With the perpetual markets cooling down and deleveraging, there is now a greater likelihood of a mid-term consolidation phase. Therefore, in the coming days, Bitcoin’s price is expected to fluctuate between the $53K and $60K levels.The 4-Hour Chart
On the 4-hour chart, the intensity of the sell-off is evident as Bitcoin’s price cascaded through several critical support zones, including the $60K psychological level and the crucial $53K mark.
However, this sharp decline has effectively flushed out most of the long positions in the futures market, leading to a temporary halt in bearish momentum when the price reached the lower boundary of a multi-month wedge pattern around $50K, causing a slight rebound.
Given the impulsive nature of the recent downtrend, the market may require a corrective phase in the near term.
The key targets for this correction lie within the Fibonacci retracement levels, specifically between the 0.5 ($62K) and 0.618 ($59.5K) levels. In the short term, Bitcoin is likely to remain trapped within the $50K to $62K range, potentially consolidating sideways until the next significant move occurs.
