Bitcoin price took a significant hit over the weekend, dropping by 7% to reach a 25-day low of $79,000 amid escalating trade tensions and diminishing market liquidity. This marked the first time in 25 days that Bitcoin traded below the $80,000 level, going back to March 11. Despite showing some resilience in the previous week, BTC ultimately gave up the gains it had made towards the end of the week.
The bearish sentiment in the Bitcoin market was fueled by rising global trade tensions, with China’s retaliatory tariffs on US imports leading to a surge in BTC price above $85,000 on Thursday. This temporary surge also benefited other altcoins like Ripple (XRP), Solana (SOL), and Ethereum (ETH), which saw gains of over 5% within a 24-hour period. However, as US markets closed on Friday, the momentum waned, and liquidity across major exchanges dried up, allowing bearish traders to capitalize on the situation.
The sudden drop in Bitcoin price led to liquidations exceeding $580 million across the cryptocurrency market, affecting over 205,000 traders. The majority of these losses came from long positions, indicating that bullish traders were caught off guard by the sharp reversal in BTC price. Altcoins such as Solana, XRP, and Dogecoin were also heavily affected by the market correction, resulting in erasure of recent gains and a dent in investor confidence moving forward.
Bitcoin’s price forecast remains bearish as BTC broke key support levels and closed below significant moving averages like the 50-day SMA and the 200-day EMA. The break below these levels signifies a structural breakdown, with weekend volatility triggering significant liquidations in the market. Despite the potential for a long-term uptrend, bulls face a challenging task of reclaiming broken trend lines to avoid further downside towards $76,000 and potentially $72,500.
The current Bitcoin price forecast hinges on the ability of bulls to reclaim key technical levels and navigate through the strong bearish momentum and high trading volume. Failure to close above $80,700 may result in further downside potential for BTC price, with a possible drop towards lower liquidity zones. It remains crucial for investors to closely monitor market developments and sentiment in order to make informed trading decisions in the volatile cryptocurrency market.
