Bitcoin is trending lower at spot rates and under immense selling pressure following events on July 3. Though the $56,000 zone is untested, at least for now, the sell-off this week means sellers are in control. If there are more losses today, the probability of BTC shrinking to $50,000 will be high, a concern for optimistic traders. Going forward, traders should watch the reaction at $56,500, aware that any rejection would be massive for buyers currently on the fringes.

Bitcoin is in red at press time, dropping 20% from May 2024 highs. From coin trackers, BTC is down 4% in the past day and week. Even though the uptrend remains, at least guided by the performance from H2 2023 to mid-March 2024, there is a reason for concern. Participation increased slightly yesterday, rising to $34 billion amid falling prices. This formation suggests that sellers are in the equation, and likely more people are exiting.

Traders and investors are keeping tabs on the following Bitcoin news:

• Bitcoin whales, on-chain data shows, are unloading, transferring in bulk, coins to top exchanges, mainly Binance. Over 2,000 BTC have been moved to Binance in the past day alone, suggesting that they might have been sold, further weakening the uptrend.
• Even though prices are up nearly 2X in the last year, most speculators, or short-term holders (STHs), are in the red, contending with losses. Even so, diamond hands, holding for at least five years, are deep in green.

Bitcoin Price Analysis

BTC/USD prices crashed on July 3, and the same were extended earlier today.

Even though there might have been hope for gains, the wide-ranging bars of July 3 and 4 decimated bulls.

For this reason, aggressive traders might choose to unload, selling on every attempt higher. The immediate target would be $56,500, marking May 2024 lows.

On the other hand, conservative traders will find entries if Bitcoin plunges below $56,500, ideally at the back of rising volume.

In the event, BTC might likely crash to $50,000 in a major correction since Q1 2024.