Bitcoin has recently fallen below the crucial $63,000 support level after clinging to $64,000. The big question now is whether the 0.618 Fibonacci level will offer support or if there is a further drop on the horizon.
A Big Swing Towards Fear
The market sentiment has shifted dramatically. The Fear and Greed Index, which was in the mid-70s indicating extreme greed, has now swung to a neutral score of 51. This 20-point drop from last week highlights increasing fear among investors.
Serious Concerns for Price
Several factors are contributing to Bitcoin’s struggle. Miners are selling off their holdings, long-term holders are taking profits, and hedge funds are leveraging their “carry trade” strategies effectively. If Bitcoin falls below $60,000 and stays there, the market could see a further drop to $48,000. Although this would still be within a bull market, it might extend the overall duration and limit the peak.
$BTC Bullish Wedge Pattern
Despite the current fear, it’s not time to panic. On the short-term 4-hour chart, Bitcoin is forming a downward sloping wedge, a typically bullish pattern. A breakout to the upside is more likely, but a downward break would be very bearish.
0.618 Fibonacci is Strong Support
Looking at the weekly chart, Bitcoin is holding above the 0.618 Fibonacci level. The stochastic RSI is at the bottom, suggesting a potential bounce. If Bitcoin falls to the 0.786 Fibonacci level, the likelihood of a bounce increases as this aligns with previous strong support.
Remember, This is Bitcoin
Amidst the uncertainty, it’s important to remember that Bitcoin is in a bull market. Given the volatility and uncertainty in fiat currencies, many investors see Bitcoin as a valuable asset. While the price may be choppy over the summer, it’s expected to revisit all-time highs eventually.
