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Bitcoin (BTC) may face significant resistance at the $65,000 level following its potential recovery from losses in June. Currently trading around $63,200, Bitcoin is attempting to recover from a 7% loss recorded in June. This decline was largely due to miner sales and concerns that spot ETF inflows were seen as directionless arbitrage bets rather than direct bullish movements, erasing gains made in May.
$65,000 is Critical
A key factor contributing to the potential resistance around $65,000 is short-term investors. This group, holding BTC for 155 days or less, is currently at a loss. According to data from LookIntoBitcoin, the total cost basis for this investor group is approximately $65,000. This means they are likely to sell their assets around this breakeven level to avoid further losses, contributing to selling pressure around this price.
Blockware Intelligence analysts warned that Bitcoin’s price has fallen below the total cost basis of short-term investors for the first time since August 2023. They predict resistance around $65,000 as short-term investors may want to exit their positions. Historically, when Bitcoin fell below this support level last summer, it traded sideways for about two months before breaking out again.
In contrast, long-term investors are less likely to sell. Currently, the average cost for this investor group is below $20,000, significantly lower than Bitcoin’s current market price. This substantial margin provides a strong incentive for long-term investors to hold onto their assets and even increase their BTC holdings.
Optimism Continues
Although Bitcoin has pulled back 15% from its peak of over $73,500 in March, long-term investors view this differently. Such a decline may seem significant to traditional market investors, but in the context of the largest cryptocurrency‘s market behavior, it is considered a normal bull market correction. For instance, during the 2017 bull cycle, Bitcoin’s drop of over 20% highlighted the market’s volatile nature.
Blockware Intelligence also noted that such price corrections are part of a healthy market cycle. They help weed out weak hands, allowing strategic investors with a long-term perspective to use capital effectively. Therefore, while $65,000 is expected to be a short-term resistance, the long-term outlook for Bitcoin remains optimistic, driven by the resolve of long-term investors and the historical context of market corrections.
