Crypto: Bitcoin May Fall To $56k As Reasons For Gains ‘remain Hard To...

Galaxy’s Alex Thorn says Bitcoin’s realized price is currently $56,000, a level it is likely to fall to without clear drivers to spark a rally.

Bitcoin could continue its downtrend as there are few catalysts to reverse the cryptocurrency’s fortunes, says Galaxy Digital research lead Alex Thorn.

Thorn said in a note on Monday that there is a “significant chance” that over the coming weeks, Bitcoin (BTC) could fall to the bottom of a gap in supply at $70,000 before testing its realized price of $56,000, the average cost of all BTC in circulation.

“Catalysts remain hard to find and narratives are also working against Bitcoin as it fails to trade along with gold and silver as part of a market-wide ‘debasement hedge trade,’” he added.

Bitcoin climbed 3% on Monday to trade just under $78,500 after climbing from a 9-month low. It is currently down 39% from its all-time peak of over $126,000 in early October, per CoinGecko.

Thorn said Bitcoin has historically traded below its realized price at the bottom of previous bear markets, and has typically found support “around or slightly below” its realized price before trading higher.

He added that Bitcoin has also seen “key support” at its 200-week moving average, its average price over that time, in each of the last three bull markets when it has fallen below its 50-week moving average.

Thorn said Bitcoin lost support at its 50-week moving average in November, while its 200-week moving average currently sits at $58,000.

“Those levels have historically marked cycle bottoms and made strong entry points for long-term investors,” he added.

Thorn said that there is also “little evidence of significant accumulation” from large buyers and long-term holders. This could weigh on Bitcoin’s price as it signals buyers could be waiting for it to move lower before buying in.

Source: CoinTelegraph