Bitcoin staged a recovery over the weekend, climbing back above $63,000 after buyers successfully defended the psychologically important $60,000 level. The rebound followed a sharp sell-off that saw the cryptocurrency lose nearly $19,000 in 10 days and post a weekly decline of approximately 14.6%.
According to CoinGecko data, Bitcoin traded near $62,700 on June 8 after briefly dipping below $60,000 on June 6 for the first time since early 2024. The bounce was fueled by short covering and a wave of buying at the key support level, but market participants remain cautious about the sustainability of the move.
Macro Headwinds and Leverage Unwind
The sell-off intensified after the U.S. Labor Department reported 172,000 nonfarm payroll additions for May, far exceeding the consensus estimate of 85,000. Revised figures added another 93,000 jobs to the prior two months, reinforcing expectations that the Federal Reserve could maintain tighter monetary policy for longer. BNP Paribas abandoned its previous forecast for stable interest rates and now projects three rate hikes beginning in December, citing persistent inflation, a strong labor market, and risks tied to the ongoing US-Iran conflict.
As sentiment deteriorated, leveraged positions unraveled rapidly. CoinGlass data showed more than $155 million in crypto long positions were liquidated within an hour, while total liquidations exceeded $1.7 billion over a 24-hour period. The Crypto Fear & Greed Index plunged to a multi-year low of 8, reflecting extreme fear among market participants.
Institutional Demand Weakens
Institutional interest also showed signs of softening during the decline. CryptoQuant reported that nearly $40 billion exited the Bitcoin ecosystem over a short period as capital rotated into U.S. equities, particularly large artificial intelligence-related companies. Additionally, Strategy's decision to sell 32 BTC to fund preferred stock dividend obligations weighed on sentiment. While the sale represented a tiny fraction of the company's roughly 840,000 BTC treasury, traders viewed it as a departure from the firm's long-standing commitment to accumulating and holding Bitcoin.
Signs of Seller Exhaustion
Despite the bearish backdrop, some indicators suggest selling pressure may be exhausting. Crypto analyst Scott Melker noted that Bitcoin short-term holders are realizing losses at the largest level on record. Data cited by Melker showed the short-term holder realized profit/loss ratio hit a new all-time low, while approximately 5.3 million BTC held by long-term holders were sitting at a loss, exceeding levels seen after the FTX collapse.
Additional on-chain data cited by analyst Seth showed the percentage of Bitcoin holders in profit has fallen to a trendline associated with major cycle lows in previous market downturns. However, not all analysts agree that a final bottom has been established. CryptoQuant contributor Darkfost reported that realized losses since the October peak have reached roughly $174 billion, still below the $211 billion recorded during the 2022 bear market, leaving room for additional downside if capitulation continues.
Bitcoin Price Analysis
On the daily chart, Bitcoin remains below all major trend indicators despite the recovery. The 20-day exponential moving average sits near $69,265, while the 50-day, 100-day, and 200-day EMAs stand near $72,844, $74,703, and $79,753, respectively. Momentum indicators paint a mixed picture. The daily RSI has recovered to around 25.8 after briefly dropping near 15.5, its lowest reading since the March 2020 COVID-era crash. The MACD indicator remains bearish, with the MACD line below the signal line, though the histogram has started contracting, signaling that downside momentum may be slowing.
From a price structure perspective, Bitcoin's defense of $60,000 remains the most important development. A sustained hold above that area could allow buyers to target the 9-day simple moving average near $65,300, followed by the 20-day EMA near $69,000. Failure to maintain support above $60,000 would strengthen the bearish case, potentially opening the door to the $58,500 and $56,000 support zones.
For broader market context, the recent sell-off in Bitcoin coincided with weakness in other risk assets. Nvidia Stock Rebounds 2% on South Korea AI Deals; CEO Calls Selloff a Discount and Tesla Rebounds 3% as SpaceX IPO, China Sales, and JPMorgan Upgrade Fuel Recovery highlight the mixed sentiment in equities. Meanwhile, Bitcoin Drops Below $60K: Crypto Market Rout Deepens on ETF Outflows, Macro Jitters provides additional context on the factors driving the downturn.
This article is for informational purposes only and does not constitute financial advice.
