Bitcoin Reverts to Consolidation, Fails to Hold $65,000 Level, Bull Run Imminent?

Bitcoin Reverts to Consolidation, Fails to Hold $65,000 Level, Bull Run Imminent?Market Sentiment Fluctuates as Bitcoin Drops Below $65,000Bitcoin price experienced a significant drop on June 16th, breaking through the $66,000 support level and hitting an intraday low of $65,046 during midday. A brief buying surge pushed the price back to $67,286, but the momentum failed to sustain, resulting in a closing price of $66,580

Bitcoin Reverts to Consolidation, Fails to Hold $65,000 Level, Bull Run Imminent?

Market Sentiment Fluctuates as Bitcoin Drops Below $65,000

Bitcoin price experienced a significant drop on June 16th, breaking through the $66,000 support level and hitting an intraday low of $65,046 during midday. A brief buying surge pushed the price back to $67,286, but the momentum failed to sustain, resulting in a closing price of $66,580.16, a 2.38% decline for the day.

Despite the pullback in Bitcoin's price, the 24-hour volatility remained near zero, indicating relatively stable market sentiment. However, considering the recent strong performance of Bitcoin, this correction could signal the beginning of a new phase in the market, making the ability to hold the $65,000 level a critical focus for investors.

Market Overview:

• Crypto Market: Only 5 out of the top 200 coins by market cap registered gains exceeding 1% on Monday. Convex Finance (CVX) led the rally with a 25.3% surge, followed by cat in a dogs world (MEW) at 19.7%. XRP climbed 5.8%. In contrast, zkSync (ZK) experienced the largest decline at 24.3%, followed by io.net (IO) at 22.1% and ConstitutionDAO (PEOPLE) at 18.7%. The total cryptocurrency market capitalization currently stands at $2.41 trillion, with Bitcoin's dominance at 54.6%.

• Traditional Market: Artificial intelligence (AI)-related stocks continued to be hot. The S&P 500 index and the tech-heavy Nasdaq 100 index continued their climb to new all-time highs, rising 0.9% and 1.2%, respectively. Some analysts have adjusted their target prices for the S&P 500 this year, with Evercore ISI raising its target to 6,000 points while Goldman Sachs expects the index to reach 5,600 points.

Technical Analysis:

Bitcoin's failure to bounce back from the 50-day moving average ($66,189) suggests continued bearish pressure. A break below this level could push the BTC/USDT pair towards $60,000. While this level might provide strong support, a sustained bearish dominance could drive the pair further down to $56,552.

Bitcoin bulls are running out of time. They need to quickly push the price above the 20-day moving average ($67,612) if they wish to reclaim momentum. Upon success, the pair could rise to $70,000, followed by a potential climb to $72,000.

Fed Rate Cut Expectations:

The CME's FedWatch tool indicates that investors currently expect a 64% chance of a rate cut in September. However, Fed President Neel Kashkari, in a CBS interview on Sunday, stated that the central bank could cut rates once this year, but likely not until December, which he described as a "reasonable prediction."

The Fed last week held its benchmark rate steady in the 5.25%-5.50% range, marking nearly a year at that level. The Fed's preferred inflation measure, the Personal Consumption Expenditures (PCE) price index, rose 2.7% year-over-year in April, well above the Fed's 2% target.

Kashkari said, "We need to see more evidence that inflation is coming down to 2%. We are very well positioned now to get more inflation data, economic data, labor market data, and then make a decision." While the market median shows only one rate cut is likely, it could come by the end of the year.

Is the pullback a Precursor to Future Gains?

Rekt Capital noted that Bitcoin may need to correct below $64,000 to achieve a healthy reset before entering the "parabolic phase" of a bull cycle: "Arguably, Bitcoin has filled both CME daily gaps, around $64,000 (blue) and around $62,500 (orange). However, Bitcoin will soon be retesting those key price levels again." This adjustment might be the prelude to an explosive breakout for Bitcoin, setting the stage for an exciting price test!

Technical Formations Hint at a Break Below $60,000?

Prominent trader Titan of Crypto issued a warning on June 16th in an X post, suggesting that technical formations on the monthly chart imply Bitcoin could break below the $60,000 level: "Right now, all eyes are on the Shooting Star formation on the 2-month chart... The 3-month chart is also important, and the candlestick doesn't look as bearish to me. As you know, the bigger the timeframe, the more reliable the trend. By July 1st, $58,800 will be a crucial level to watch very closely." Will this warning come to fruition? The Bitcoin market is poised for a thrilling test!

RSI Suggests Potential for a Pullback:

Looking at Bitcoin's Relative Strength Index (RSI), the cryptocurrency might require a period of cooldown before a vigorous rebound. On June 17th, Bitcoin's RSI stood at 41, indicating a price within a reasonable range. However, revisiting the last major correction on May 1st, Bitcoin's RSI dipped to 33, with the price reaching $56,600 before a swift recovery fueled a strong rally. Will history repeat itself this time? We will watch closely as Bitcoin may be gearing up for its next bull run!

$64,500 Level Represents a Crucial Support:

Liquidation levels indicate strong support at the $64,500 level for Bitcoin. According to Coinglass data, over $520 million in leveraged long positions face liquidation risk if this level is breached. This crucial point acts as a bulwark for the Bitcoin market, leaving its fate uncertain!

Short-Term Holders' Cost Basis Hints at Potential Support:

Short-term holders (STH), the bold investors who hold BTC for less than 155 days, have a cost basis that suggests potential for Bitcoin to find solid support above $62,200. Based on CryptoQuant data, the realized price for Bitcoin's short-term holders is $62,200. As STH represent the most speculative segment of Bitcoin holders, their realized price might hint at a crucial upcoming support level, with $62,200 possibly marking the starting point for the next bull run.

Conclusion:

Bitcoin price remains uncertain after experiencing a notable drop. Technical analysis suggests a potential correction below $64,000 for Bitcoin to achieve a healthy reset. However, the cost basis of short-term holders indicates potential for Bitcoin to find support above $62,200, setting the stage for the next bull run.

Investors Need to Be Aware:

Market fluctuations are significant. This content is for informational purposes only and should not be considered investment advice.

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