The price of Bitcoin (BTC) fell to $65,800 on Wednesday, falling back below key intraday trendlines and raising concerns that last week's decline to $60,000 might not be the ultimate bottom. Now analysts say the potential of an extra decline to the yearly low ($59,800) is increasing on account of a widening liquidity gap between $66,000 and $60,000.
Key Takeaways:
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Bitcoin has formed a series of lower highs following repeated rejections near the $70,000-$72,000 resistance zone.
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The Relative Strength Index (RSI) is trending towards oversold levels as the worth is below key moving averages.
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The liquidation heatmap suggested a liquidity shortage of as much as $60,500, leaving the chance of a downward price movement open.
Failure to take care of $70,000 will weaken Bitcoin’s short-term prospects
Bitcoin's one-hour chart shows several failed attempts to remain above $70,000. Each rejection has resulted in cheaper price highs and regular selling pressure.
BTC price briefly rose to an intraday high of $69,800 before reversing sharply during Wednesday's New York session, forming a classic swing failure pattern. The move captured breakout long positions and accelerated the bearish momentum.
Bitcoin one hour chart. Source: Cointelegraph/TradingView
BTC also traded below the 50 and 100 period exponential moving averages, confirming short-term bearish control. The relative strength index (RSI) remained below 50, indicating limited buying pressure.
A 15-minute order block sits near the $60,800-$61,000 area, an area that previously saw strong buying pressure after BTC hit a yearly low of $59,800. This region stays a liquidity goal if the $64,000 mark isn’t reached.
Heatmap data shows that $60,000 is a liquidity magnet
Bitcoin’s liquidity heatmaps show stacked orders above $72,000, but in addition point to a “liquidity gap” between $66,000 and $60,500. This “liquidity gap” can act like a magnet as price tends to maneuver quickly through areas of low liquidity to tap into the concentrated stop clusters underneath.
Bitcoin liquidity heatmaps. Source: CoinGlass
Although visible liquidity is higher, downside potential stays open as a final stack of leveraged long positions price over $350 million continues to be near $60,500.
Bitcoin trader Husky said Bitcoin is slipping below the anchored volume-weighted average price (VWAP) derived from last week's lows of $59,800, a level that serves as a short-term fair value.
As the general market structure begins to weaken, the shortage of a fast recovery above $68,000 increases the chance of further downside towards lower support levels near $65,000. According to the trader, Bitcoin is currently expected to trade in a wide selection of $60,000 to $72,000.
Bitcoin evaluation by Husky. Source: X
Likewise, market analyst EliZ noted that BTC is consolidating inside a descending channel near $66,500. A break below this level could push the worth towards the $63,400-$64,600 support zone and increase the possibilities of a revisit to $60,000.
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