Bitcoin Holds Above $57,000 – What Comes Next?

Following a steep market downturn on August 5th, the cryptocurrency landscape is rebounding.

Key players like Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) have seen notable price increases over the past couple of days.

Julio Moreno from CryptoQuant has observed that Bitcoin is showing potential bearish signals. He shared on X (formerly Twitter) that the bull-bear market cycle indicator has turned bearish for the first time since January 2023. Historically, similar signals appeared during the market crashes in March 2020 and May 2021.

The Bull-Bear Market Cycle Indicator has flagged BEAR phase (high blue area) for the first time since January 2023.

Other periods when it has flagged BEAR phases for a limited period have been the COVID sell-off (March 2020) and the Chinese mining ban (May 2021). It then… pic.twitter.com/hwJRFjJuFg

— Julio Moreno (@jjcmoreno) August 6, 2024

Despite these indicators, CryptoQuant’s CEO Ki Young Ju believes Bitcoin can stay bullish as long as it remains above $45,000. He noted that if Bitcoin holds this level for a week or two, it could recover; otherwise, the risk of a bear market increases.

Currently, Bitcoin is trading above $57,200, showing a 4% rise in the last 24 hours, though trading volume has dropped by 38%, indicating cautious market sentiment.

Technical analysts suggest Bitcoin might reach $60,000 soon, facing resistance at this level from the trendline and the 200 EMA. A successful breakout could lead to a rally towards $70,000. However, a drop to $54,700 could trigger significant long position liquidations, while a rise to $58,000 might liquidate short positions.

At the time of writing, Bitcoin is trading at around $57,200 after a 11.5% weekly drop and no significant moves in the past 24 hours.