Bitcoin Price Prediction: BTC Dumps 13% To $57K, Find Out Why

The Bitcoin price is down 4.5% over the last 24 hours to exchange hands at $57,399 as of 2:00 a.m. EST.

BTC has taken a nosedive falling more than 13% over the last three days and market participants and analysts wondered how low the price could go.

Several factors have contributed to BTC's drawdown since its halving on April 2022. According to popular analyst Rekt Capital, Bitcoin's current price action is part of a normal halvign cycle where the price consolidates after the subsidy halving in a "Re-accumulation Phase" before embarking on a sustained parabolic uptrend.

According to Moustache, a crypto trader and analyst, the price of the big crypto was on course to hit a bottom soon as shown by its RSI which was just about to enter the oversold zone. According to the analysts, this has "always signalled the bottom" in the past.

Another interesting bit: some 60% the Bitcoin out there was making money losses for its holders, a scenario that's often a prelude to some selling out of FUD. This is is reinforced by data from IntoTheBlock – an on-chain analystics and market insights firm – whose In/Out of the Money Around Price (IOMAP) model showed that approximately 63% of investors who bought Bitcoin between $48,800 and $66,oo, are currently in in losses.

Bitcoin IOMAP Chart. Source: IntoTheBlock

This cohort of investors may be booking panic selling at the moment, explaining the current pull back. How low can Bitcoin go?

Bitcoin Faces Still Resistance Around $62,000

BTC price has painted a three consecutive red candlesticks on the daily chart, signaling the strength of the overhead pressure exerted on the pioneer cryptocurrency at the moment. This is shown in the amount of trading volume coming in which has increased by 30% over the last 24 hours to $49.5 billion, according to data from CoinMarketCap.

After dropping below the 50-day exponential moving average (EMA) on April 24, BTC oscillated around the $62,000 level, suggesting that it represented a key defense zone for Bitcoin bulls. The bulls were unable to defend this level which now the lost on April 30 and has now turned into stiff resistance.

The stiffness of the barrier at $62,000 is also reinforced by data from the same IOMAP chart, shown above. According to this chart, this level lies between the $60,828 and $62,568 price range where approximately 419,920 BTC were previously bought by roughly 1.2 million addresses.

These investors could be the ones taking profits at the moment, exerting more overhead pressure on the price.

BTC/USD Daily Chart. Source: TradingView

If this persists, Bitcoin could continue dropping with the first line of defense arising from the $55,000 buyer congestion area.

Perhaps the most significant defense for BTC would emerge from the $52,000 to $50,500 buyer congestion zone, where the 200-day EMA lies. This is where Bitcoin's downside could be capped in the short term.

Bitcoin's pessimistic outlook is supported by the sharp movement of the Relative Strength Index (RSI) away toward the oversold zone. The price strength is at 30 attests to the strength of the downtrend. As such, Bitcoin may continue dropping in the near-term.