Bitcoin’s price action above the $71,600 mark indicates a possible upcoming correction. The question now is how far will the price drop before entering the parabolic phase?
BTC price clusters above $71,600 point to potential correction
Bitcoin’s price clusters typically gather around whole numbers, and the recent cluster near $71,600 suggests a downside movement may be imminent. This observation comes from renowned crypto analyst Rekt Capital, who shared his insights with his large following on June 17.
Bitcoin reached a high of $71,949 on June 7 before sliding to the current $65,393 level. This represents a 5.7% decline for the week, according to data from Bitstamp.
Is another dip below $64,000 necessary before the rally continues?
In order for Bitcoin to enter the much-anticipated parabolic phase of the bull cycle, it may need to correct further and drop below $64,000, as suggested by Rekt Capital. However, another perspective from trader Titan of Crypto, shared on June 16, hints that Bitcoin could potentially fall below $60,000 based on a technical formation seen on the monthly chart.
Looking at the Relative Strength Index (RSI), it appears that Bitcoin’s price might need to cool down more before heading higher. The RSI currently stands at 41, indicating fair value for the asset. In comparison, during the last significant correction on May 1, the RSI dropped to 33 as the price fell to $56,600 before resuming its upward momentum.
The RSI, a widely-used momentum indicator, helps determine if an asset is oversold or overbought based on recent price changes.
Support levels and potential liquidation points
Bitcoin seems to have strong support around $64,500, according to liquidation levels. A breach below this level could trigger liquidation of over $520 million in leveraged long positions, as per Coinglass data.
Short-term holders (STHs), who hold Bitcoin for up to 155 days, may find support around $62,200. This is indicated by Bitcoin’s realized price for STHs, as reported by CryptoQuant data. Since STHs are more speculative holders, their realized price could serve as a crucial support level for Bitcoin’s price moving forward.
It is important to note that this article does not provide investment advice. All investment and trading decisions involve risk, and readers are encouraged to conduct their own research before making any decisions.