Bitcoin rebounds to $61,966 after crash to $59,100

Bitcoin has pulled back to one of the most crucial support zones of its current market cycle following heavy selling. After plunging to $59,100 on June 5, an area that has previously both halted major declines and paved the way for deeper drops, BTC was recovering near $61,966 as of publication. But the pressing question lingers: Is Bitcoin forming a new bottom, or is this just a brief pause before another sharp sell-off?

Technical signals at a critical threshold

One of the key indicators closely monitored for Bitcoin’s long-term prospects, the 200-week exponential moving average, has come back into focus. Commentator Michaël van de Poppe pointed out that in most of Bitcoin’s previous down cycles, bottoms were typically established near this level, with 2022 as a notable exception. Van de Poppe also stressed that the latest pullback ranks among the steepest in Bitcoin’s history, making the situation hard to read.

According to Michaël van de Poppe, while the 200-week exponential moving average has often served as a bottom in past cycles, the sheer force of current selling pressure means a clear recovery cannot be guaranteed.

Daan Crypto Trades offered another technical perspective, noting that when Bitcoin has lost major support in the past, it usually accelerated downward and rarely reclaimed those levels quickly. This time, however, BTC at least so far is managing to stay close to its previous lows. If this pattern holds, Bitcoin could trade within a broad band between $60,000 and $80,000. This range alone doesn’t confirm a bullish reversal, but signals that sellers may be struggling to force a deeper breakdown.

Split views and possible market scenarios

There is a growing divide among market participants about where Bitcoin is headed next. Crypto Candy remains bearish, arguing that if the current downtrend persists, the next major target for Bitcoin could be $55,000 or lower. This outlook holds unless BTC reverses the current trend and reclaims stronger resistance zones.

BitBull, by contrast, sees a different setup. While confidence among bullish investors appears to be fading, BitBull believes Bitcoin could actually be laying the groundwork for a so-called bear trap. They argue that peak uncertainty tends to show up near turning points, not after recoveries.

BitBull, who was bearish when Bitcoin traded near $80,000, now says that view has changed at current levels, as the sharp drop has altered the risk-reward balance.

Exchange reserves raise caution flag

Another development that’s drawing attention, beyond the technical landscape, is how Bitcoin is flowing into exchanges. Bitfinex has highlighted an unusual trend in exchange reserves. Despite large liquidations and a 26% price correction, Bitcoin held on exchanges has risen to 2.72 million BTC, ending months of steady outflows.

Mini glossary: “Exchange reserves” refers to the total amount of cryptocurrency held in trading platforms’ wallets. An increase in reserves can signal more coins available for sale in the market, while a decrease may indicate investors are moving assets off exchanges to hold them long-term.

This metric is seen as crucial, as many local bottoms in the past coincided with accelerating outflows from exchanges, reducing the amount of Bitcoin available to be sold. Now, however, the trend is reversed; reserves are rising during the decline, suggesting potential for heightened selling pressure rather than accumulation.

Currently, Bitcoin remains near key support, though market behavior has yet to confirm this region as a new cycle bottom. With prices seeking equilibrium, inflows to exchanges are reinforcing a more cautious market outlook.