Bitcoin: What is the Reason for the Current Price Drop?

The top cryptocurrency turned bearish midway through the week, despite the Federal Reserve's meeting minutes hinting at a potential rate cut on the horizon.

The Fed emphasized that unemployment remains manageable and inflation is gradually easing.

In the wider crypto market, total market value dropped by 3.2% in the last 24 hours, settling at approximately $2.22 trillion. This decline triggered the liquidation of over $161 million in leveraged positions, with long traders bearing the brunt.

On-chain data reveals that whales are selling off assets, adding to market concerns. U.S. Bitcoin ETFs experienced a net outflow of $30 million on Wednesday, while BlackRock’s IBIT registered an inflow of $13.88 million.

In the last 24 hours, over 3,200 BTC were moved to exchanges, signaling more potential selling pressure.

After failing to surpass the $65,600 resistance level in recent weeks, Bitcoin has entered a descending parallel channel that began in March. Analyst Michael van de Poppe believes Bitcoin could fall below $60,000 and test support near $57,000.

A consistent close below this level could lead to further declines, with the next key support around $52,000. However, a breakout above $66,000 could signal a new rally, with $72,000 as the next potential target.