Bitcoin’s (BTC) price has struggled to recover from its recent downturn, causing concern in the crypto market. Despite this, the cryptocurrency faces further potential drawdown not due to bearish sentiment, but because of investor bullishness.
Recent Bitcoin Price Drop

Bitcoin’s price plummeted from $62,000 to $53,300, shaking the crypto market and dashing many bullish hopes. The futures market saw long liquidations totaling $263 million over three days. This marked the second-highest liquidation event in the past two weeks, with the last significant liquidation occurring in April. Typically, such large liquidations tend to make investors cautious, allowing the market to stabilize.
Investor Sentiment and Federal Reserve Impact

However, BTC holders appear to disagree with this cautious approach. The recent price drop is attributed to Federal Reserve Chair Jerome Powell’s bearish speech. Despite this, investors are optimistic about a quick recovery and are preparing to capitalize on it.

Analyst Willy Woo pointed out the difference between buying futures and buying spot, noting that the former can create a bearish environment, potentially leading to further losses.
Bitcoin Futures Market Risk

According to the Bitcoin Open Value Oscillator, approximately half a million long contracts remain open in the futures market. If Bitcoin’s price drops further, these long positions could be liquidated, resulting in an extended period of bearishness for BTC.
BTC Price Prediction: Validating the Pattern

Currently, Bitcoin’s price is stabilizing at $56,961 after nearly dropping to $53,300. However, the cryptocurrency has yet to complete the expected 17% drawdown predicted by the double top formation from four months ago.

This prediction targets a drop to $50,900, which would trigger massive long liquidations. If BTC loses its $55,000 support level, this scenario becomes more likely. Conversely, if Bitcoin’s price rebounds from $55,000 and turns $58,800 into support, a recovery could begin, potentially pushing the price back up to $60,000 and invalidating the bearish outlook.

Bitcoin faces a critical juncture as investor bullishness clashes with market risks. The potential for massive futures liquidations looms, contingent on Bitcoin’s ability to maintain key support levels. Investors and analysts alike are watching closely to see if BTC can overcome these challenges and initiate a recovery.

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