Bitcoin (BTC) Sees 10% Value Loss in One Week
Bitcoin (BTC) has experienced a 10% decrease in value over the past seven days, with a downward trend observed since reaching a weekly high of $69,801 on July 29. Currently, the leading digital asset is priced at $60,551, offering a potential buying opportunity for traders looking to capitalize on the trend reversal. Despite this, the reluctance of traders to “buy the dip” is evident in the token’s social activity.
Factors Behind Traders’ Hesitation to Buy the Dip
The Market to Realized Value (MVRV) ratio of Bitcoin indicates that the cryptocurrency may be undervalued. Santiment reports negative MVRV ratios of -6.08 and -6.57 for the 30-day and 90-day periods, respectively. A negative MVRV ratio suggests that the current market value of an asset is lower than the average purchase price of circulating tokens, signaling undervaluation.
While a negative MVRV ratio typically presents a favorable buying opportunity, retail traders seem reluctant to accumulate Bitcoin, fearing further price drops. This sentiment is reflected in BTC’s Fear and Greed Index, currently standing at 34, indicating prevailing market fear.
On-chain data provider Santiment highlighted the lack of enthusiasm among traders to buy the dip, suggesting that key psychological levels of $60,000 for BTC could trigger increased buying interest.
Potential Bearish Scenario: Bitcoin Price Predicted to Drop Below $50,000
Analysts warn of the possibility of Bitcoin falling below $50,000 due to negative market sentiment and adverse macroeconomic conditions. CryptoQuant analyst Abramcharts notes the inability of BTC holders to maintain crucial support at $64,580, predicting a potential target range of $53,000 to $54,000 if this level is breached.
Additionally, 10x Research points to weaknesses in the ISM manufacturing index and potential stock market declines as factors that could push Bitcoin below $50,000. The prospect of a Federal Reserve emergency rate cut, signaling economic recession, could further exacerbate the decline.
Market Outlook and Price Targets
Based on Fibonacci retracement levels, BTC’s next price target is $58,699 in a continued downward trend. However, if an upward reversal occurs, the price could rise to $61,466.
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