Bitcoin (BTC) fell more than 2% on July 4 as a key support level was retested for the first time since October 2023.
The recent BTC price crash is believed to be due to “spot selling”
According to data provided by Cointelegraph Markets Pro and TradingView, Bitstamp’s latest daily close has seen a new local low of $57,885.
The lack of investor sentiment combined with the steady selling in the spot market has created an unfavorable situation for Bitcoin bulls.
According to data from monitoring resource CoinGlass, at the time of writing, 24-hour BTC long-term liquidations amounted to approximately $60 million.
Commenting on the recent price action, popular trader Skew noted that BTC/USD broke above its 200-day moving average (MA) for the first time in 10 months.
“Spot selling has been the main driver of this trend since the trend rejection and reversal around $63.8K so far,” he explained in part of a post on X (formerly Twitter).
“So for this HTF MA to actually act as a systematic trigger in the market, it needs to confirm market demand and reversal signals, otherwise volatility and momentum will spike to the downside.”
At the time of writing, the 200-day moving average was at $58,400, which is still slightly below the spot price even after the low time frame bounce.
Looking closer, trading group DecenTrader expects a large number of long-term liquidations to occur near the $50,000 level if prices fall further.
“*IF* Bitcoin crashes, $51k-$52k remains the area with significant 3x, 5x, 10x long liquidity. On the upside, short liquidity is at $76k-78k,” he said.
$24 billion sale
Charles Edwards, founder of Capriol Investments, a quantitative Bitcoin and digital asset fund, sees clear factors contributing to the recent downtrend.
Related: Was $60K a Bear Trap? 5 Things to Know About Bitcoin This Week
He argued that Bitcoin has been under significant selling pressure throughout the year, with data from on-chain analytics firm Glassnode suggesting that the U.S. spot Bitcoin exchange-traded fund (ETF), which launched in January, has failed to absorb the fallout.
“This is why we haven’t done Mooning yet. Sailors, Michael Dell, ETFs. It’s all noise,” he told X followers.
“When we look at the data from the four most important players in Bitcoin, we see a net outflow of $24 billion from the market in 2024.”
Edwards stressed that he doesn’t see ETFs as the “only demand” in the market right now.
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.