The post Bitcoin (BTC) Price At Risk of Dropping Below $50K Again : Here’s Why appeared first on Coinpedia Fintech News
In the past 24 hours, the cryptocurrency market has increased by 1.6% to reach $2.08 trillion. However, a recent sell-off from a peak of $2.15 trillion, representing the midpoint of the past 30 days’ range, has tempered gains. Despite an overall rise in cryptocurrency prices compared to the previous day, there’s a clear selling trend as prices climb. The market sentiment index has risen to 31, indicating fear, up from 25 the day before.
Bitcoin’s recent rebound from sub-$50,000 levels initially sparked hopes for a bull run, with expectations of reaching $90,000. However, Alex Kuptsikevich, senior market analyst at FxPro, offers a more cautious outlook, suggesting that Bitcoin might experience a $5,000 decline rather than a similar rise.
Kuptsikevich’s bearish stance is grounded in several technical factors, let’s dive in.
Bitcoin Price Crash Looming
Bitcoin has faced resistance at $60,000, however, the fear of death cross, indicated by the 50-day Exponential Moving Average (EMA) crossing below the 200-day EMA, suggests further downside risks. This crossover often indicates that selling pressure may outweigh buying interest, suggesting further declines.
However, the last significant death cross for Bitcoin was on September 12, 2023. This pattern initially led to a price drop to $24,900, but Bitcoin rebounded and reached new highs above $70,000 by March 2024. This shows that while the pattern can signal downturns, it doesn’t guarantee them.
The next thing that needs a good analysis is the 14-day RSI, which has recently exited oversold territory. After Bitcoin’s sharp drop last Monday, the RSI indicated an oversold condition, typically signaling a potential for price stabilization or recovery. However, with the RSI now losing strength, the potential for a further decline remains significant.
Impact of Upcoming Economic Data
The short-term outlook for Bitcoin could be influenced by upcoming economic reports, specifically the U.S. Consumer Price Index (CPI) data. Scheduled for release on Wednesday, the CPI figures will provide insights into inflation trends. Higher inflation could dampen hopes for Federal Reserve rate cuts, impacting overall market sentiment and Bitcoin’s price.
Political and Market Sentiments
Bitcoin’s recent price recovery has been stagnant amid changing political scenarios. The shift in election prediction markets, with pro-crypto Republican candidate Donald Trump losing ground to Kamala Harris, could add to the market’s uncertainty. The interplay between political developments and economic data could further affect Bitcoin’s short-term performance.
Conclusion
In short, while Bitcoin’s recovery from below $50,000 initially fueled bullish sentiment, technical indicators suggest potential downside risks. The death cross, weakening RSI, and upcoming CPI data all contribute to a cautious outlook. Plus, shifting political landscapes may further impact market sentiment and Bitcoin’s price trajectory.
