coin imageBTC20432.39USD(-0.69%)
Weekly Market Update: Bitcoin dips below 20K, will it drop further?
  • Will this be the bottom? Or was it a dead cat’s bounce?
  • What’s in store next week?

June has come to an end. In the world of trading, this means two things. First, the figures for the second quarter will be released next week. And we will be able to take a look at the economy over the last six months.

In the last quarter, the numbers were very red (in double digits), but not only in the crypto world. Since the beginning of April, the value of the entire crypto market has fallen by 62%. Bitcoin fell 60%, and the SP500 fell 18%.

Will this be the bottom? Or was it a dead cat’s bounce?

Bitcoin fell into an important weekly supply zone. In fact, this zone was responsible for taking out the ATH in 2017. At that time, this zone caused a strong upward movement of about 250%. However, so far there are no signs of a clear reversal. If bitcoin falls below 16.2K, there could be another downtrend to the 11-12K range. The two possible scenarios are shown in the figure below.

Historical data shows that bitcoin has consistently fallen about 80-90% from the ATH in the last decade. Right now, bitcoin is down 75% from the ATH. The next major weekly demand zone at 11K could result in a drawdown of 83% from the ATH.

What’s in store next week?

Next week, the U.S. labor market data will be published. This shows the change in the number of people employed during the previous month, excluding agriculture. The expected number for June is 295K, while the number for May was 390K. This indicates that the economy is contracting and should be taken as a bearish sign for the US dollar.

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