Bitcoin plummeted to as low as $53,600 on Coinbase on July 5, marking its lowest point since February, sparking concerns among analysts about potential further declines.
As of the latest data from TradingView, Bitcoin (BTC) has stabilized somewhat, trading at $54,122.
Market analyst Josh Gilbert from eToro attributed much of the recent sell-off to apprehensions surrounding the impending repayments to Mt. Gox creditors, expected to inject approximately $8 billion worth of BTC into the market this July.
Gilbert expressed pessimism about Bitcoin’s immediate future following its drop to $53,600, anticipating more downward pressure in the days ahead. He emphasized the prevailing negative sentiment in the news cycle, which has been unsettling for investors and contributing to increased selling.
“The current news flow leans heavily bearish rather than bullish, prompting a cycle of selling that further unsettles investors,” noted Gilbert. “We may see weakness persist until a catalyst emerges to drive prices up, whether it’s investor sentiment shifting to ‘buying the dip’ or approval of an ETH ETF.”
Similarly, Pav Hundal, an analyst at Swyftx, echoed concerns about Bitcoin’s price trajectory, suggesting that the worst may not be over yet.
“A substantial volume of Bitcoin is poised to enter a market already showing indifference. While long-term macro conditions remain positive, short-term prospects could test levels as low as $50,000, with $52,000 serving as a critical battleground between bearish and bullish forces,” Hundal remarked.
Analysts at 10x Research also anticipated a prolonged decline, foreseeing Bitcoin potentially dropping to $50,000 in the coming weeks. They cautioned that further selling pressure could intensify if support levels weaken and sellers rush to find liquidity.
Despite the gloomy short-term outlook, Gilbert highlighted reasons for optimism among investors looking at the longer horizon.
“In addition, the potential approval of an Ethereum ETF by the SEC, slated for a July launch, would be a significant boost for the overall crypto market,” he added.
For further insights, read our magazine piece on why ‘Bitcoin Layer 2s’ may not actually qualify as L2 solutions.