Bitcoin’s Decline Dampens Market Sentiment

As digital gold fell below $57,000, the cryptocurrency fear and greed index dropped to 44 points, confirming bearish market sentiment.

#crypto market sentiment has turned into fear! pic.twitter.com/HdRK0j52E8

— Ali (@ali_charts) July 4, 2024

At the time of writing, the leading cryptocurrency is trading at $57,800, having fallen 5.5% over the week.

Technical analyst Ali noted the “brutal” movement of the leading cryptocurrency. However, in his view, the volume of liquidations was not as significant.

#Bitcoin price action has been brutal, but only $280.9 million in longs have been liquidated and $25.4 in shorts. In the past, we have seen mass liquidation events of over $1 billion!

This tells us either the $BTC dip is not over yet or shorts are about to get obliterated. pic.twitter.com/PXoaKuWqfE

— Ali (@ali_charts) July 4, 2024

“Only $280.9 million in longs and $25.4 million in shorts have been liquidated. In the past, we have seen mass liquidations of over $1 billion. This tells us that either the dip is not over yet or shorts are about to get obliterated,” the expert wrote.

In his opinion, the leading cryptocurrency is declining because investors continue to buy it on dips. He also pointed out a $36 million liquidation pool at the $57,700 level.

The #Bitcoin dip keeps dipping because too many people keep buying the dip! Now, a $36 million liquidation pool is up for grabs at $57,700. pic.twitter.com/PsozPARFXQ

— Ali (@ali_charts) July 4, 2024

As the correction deepens, investors are beginning to “feel anxious,” Ali added. The unrealized profit/loss chart shows that at prices below $60,000, investor sentiment shifts from “belief” to “anxiety.”

#Bitcoin investors are starting to feel the anxiety as the dip deepens! pic.twitter.com/upCrNkpgz0

— Ali (@ali_charts) July 4, 2024

Technical analyst and head of Factor LLC, Peter Brandt, noted that on the daily chart, Bitcoin broke the support level and formed a “bear flag” pattern, indicating a potential continuation of the downward trend.

Here in the U.S. on the July 4 weekend our attention always turns to flags $BTC pic.twitter.com/rZifxnz0ch

— Peter Brandt (@PeterLBrandt) July 3, 2024

Negative Factors

On July 4, several wallets of the Mt.Gox exchange were activated in three transactions ahead of expected $9 billion creditor repayments.

According to Arkham Intelligence, two addresses associated with the trading platform participated in test operations. The largest transfer was $24 in the leading cryptocurrency (the others were less than $1).

Mt Gox activating their wallets finally for repayments. Stay safe $BTC pic.twitter.com/SjST18kgoP

— Block_Diversity v.8 ™️ (@i_bot404) July 4, 2024

The trustee of the bankrupt exchange, which collapsed in 2014, had previously announced plans to begin phased reimbursement of 137,000 BTC to users at the start of the month.

On the same day, 237 BTC worth $13.67 million were moved from a U.S. government-linked address.

The wallet contained assets confiscated from HashFlare and Polybius Bank founders Sergey Potapenko and Ivan Turygin.

The transfer followed a series of transactions from the wallet of Germany’s Federal Criminal Police Office (BKA). Authorities sent 1,300 BTC (~$75.5 million) to several centralized exchanges.

Initially, the BKA wallet held 50,000 BTC, seized by law enforcement in January from administrators of the pirate movie site Movie2k.

On June 19, authorities began moving assets, some of which had already reached exchanges. Arkham experts noted recipients of the transactions included Coinbase, Kraken, Bitstamp, and market maker Flow Traders.