Markets
What’s Next for Bitcoin (BTC) Price? Traders Target $50,000 as Selling Pressure Runs into Billions
Bitcoin (BTC) Traders expect prices to fall as low as $50,000, a level not seen since mid-February, in the coming weeks as the largest cryptocurrency by market capitalization could face billions of dollars in selling pressure.
BTC prices have fallen by more than 10% in the past seven days, according to data from CoinGecko, below a critical technical indicator Thursday and wiping out all gains since late February.
Trading firms such as QCP Capital have attributed the bearish sentiment to the wallet activity of a German government entity and the defunct cryptocurrency exchange Mt. Gox, and some market analysts say more trouble lies ahead.
“The selling pressure on Bitcoin is unlikely to ease in the coming days,” Rachel Lin, founder of on-chain cryptocurrency exchange SynFutures, said in an interview. “The German government still has over $2.3 billion worth of Bitcoin, Mt. Gox has over $8 billion, and the U.S. government has over $12 billion.”
“The market expects most Mt. Gox users to dump their tokens, but we could see a rebound if sales are lower than expected. On the other hand, if there is enough selling to push the price down, we could soon reach the $50,000 level,” she said.
Alex Kuptsikevich, senior market analyst at FxPro, echoed this sentiment in an email to CoinDesk: “Bitcoin has fallen below the 200-day moving average and has so far failed to bounce back above it, trying to stay within established patterns.
“From the current position, a further decline to $51,000 (February consolidation zone) is more likely than a similar rise to $65,000,” Kuptsikevich added. Moving averages are a measure of an asset’s closing prices over a given period that can help identify a trading opportunity.
Additionally, a wallet linked to Germany’s Federal Criminal Police Office (BKA) has been transferring millions of dollars worth of bitcoin to cryptocurrency exchanges since mid-June. Traders say the moves imply an intention to sell the assets confiscated in 2013 on a hacking marketplace.
Meanwhile, BTC prices appeared to recover briefly mid-morning in Europe, dropping from a low of $53,600 in the early hours of the day in Asia to nearly $55,000. The sudden drop triggered more than $550 million in long positions in cryptocurrencies, or bets on higher prices, to be liquidated in the last 24 hours.