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Bitcoin Reclaims $56k But Still Faces Potential Drop to $47K, Analyst Reveals Why

Bitcoin has recently exhibited resilience that has surprised many market spectators. Following a dismal drop to a 24-hour low of $53,898, Bitcoin clawed its way back above the $56,000 mark, up 1.6% in the past hour.

This rebound has been catalyzed by the latest US NFP report revealing a surge in the unemployment rate, which has sparked a surge in buying activity, momentarily easing the bearish pressure. However, this recovery may not signal a sustained upward trend, as experts hint at potential further declines.

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Analyst Bitcoin Predictions: A Potential Drop To $47k

A prominent crypto analyst, Ali, has expressed concerns about Bitcoin’s current market positioning. Despite the recent price recovery, he suggests that Bitcoin could significantly drop to around $47,000.

This prediction stems from his analysis of Bitcoin’s support levels, which he believes are insufficient to sustain a long-term bullish momentum.

According to Ali, for Bitcoin to resume its bull run, it would need to “close and hold above $61,000″—a scenario that seems increasingly speculative given the current market condition.

Amid these turbulent market conditions, other financial experts remain cautiously optimistic. Samson Mow, a notable figure in the cryptocurrency space, argues that the current price levels of Bitcoin are the result of artificial market manipulation.

He particularly labels the drastic price movements as “artificial price suppression,” influenced by significant Bitcoin transfers by government entities during periods of low market liquidity. Mow’s assertion suggests that external market forces are at play, potentially skewing the natural price discovery process of Bitcoin.

BTC price is moving downwards on the 2-hour chart. Source: BTC/USDT on TradingView.com

Surge In Volatility Ahead

Meanwhile, Greek Live highlighted emerging volatility in the cryptocurrency market earlier today, focusing on the imminent expiration of many Bitcoin and Ethereum options.

The report detailed that 18,000 BTC options and 164,000 Ethereum options are set to expire soon, representing notional values of $1 billion and $470 million, respectively.

This situation is particularly notable due to the skewed Put Call Ratios and defined Maxpain points, suggesting potential price pivots at $61,500 for Bitcoin and $3,350 for Ethereum.

The onset of July brought significant market downturns, hitting new monthly lows across major cryptocurrencies. The end of the quarterly cycle triggered enhanced market volatility, providing a strategic window for institutional players to establish positions.

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Furthermore, amidst a bearish market sentiment, there’s a noticeable increase in the implied volatility of put options for Bitcoin and Ethereum, indicating growing caution among traders.

Greeks Live further reported that with the upcoming news on Ethereum ETFs and the attractive pricing of end-of-month call options, there’s a strategic opening for investors looking to capitalize on these market conditions.

Featured image created with DALL-E, Chart from TradingView



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