While Bitcoin has been going up and down in the last few days, the BTC price fell off the cliff yesterday evening, falling to low levels not seen since the beginning of May.
This volatile price action caused futures investors to liquidate hundreds of millions of dollars, as BTC dropped to lows of $58,400 before recovering above $60,000.
At this point, while investors and analysts are speculating about what will happen next in BTC, successful analyst Willy Woo made some predictions about BTC's short-term price targets.
Stating that the last Bitcoin correction below $ 59,000 was caused by excessive long positions in the futures market, Willy Woo said that the last decline managed to eliminate the excessive leverage in the market, but the work is not over yet.
Woo noted that Bitcoin cleared a large number of long positions for its first major target of $62,500, but investors continued to add new long positions with the recovery, adding “investors added more fuel to liquidate more longs in a gradual long squeeze.” said.
Explaining that the long liquidation squeeze as well as the miners' BTC sale were also effective in the recent decline, Woo said:
“On top of this liquidation squeeze, we are facing a post-halving miners capitulation.
Miners are going on a BTC selling spree to pay for hardware upgrades because old hardware is no longer profitable. The weakest miners are closing shop and being liquidated.”
Bitcoin Has a Risk of Falling Further!
Finally, Woo said that while he predicted that short-term technical factors point to a reversal for BTC, Bitcoin still carries a risk of decline.
Because, according to Woo, the Bitcoin price will not move upwards in a sustainable manner without a significant decrease in BTC futures positions.
Woo noted that there is a very high probability that Bitcoin will see new lows, and the next key level to watch is $54,000, which is another layer of liquidation.
Woo also emphasized that the $54,000 level serves as a critical boundary between bearish and bullish trends, and a break below this level will be critical for BTC given the current macro structure.
I don't usually do short time frame price action as it's the domain of gamblers. But worth a break down of what's happening given the fear in the market…
We've been flushing out the leverage, 62.5k was the target to get most of it.
Until… https://t.co/ughwSKGYoo
— Willy Woo (@woonomic) June 24, 2024
*This is not investment advice.
