Bitcoin (BTC) held firm above $105,000 as price action remained muted amid escalating political and market concerns. The flagship cryptocurrency had plunged to an intraday low of $100,421 late on Thursday before rebounding on Friday and reclaiming $105,000 on Saturday.
BTC has been marginally up over the past 25 hours, trading around $105,695. Analysts are optimistic that the price will stabilize above $105,000 and push higher.
Public Companies Turning To Bitcoin (BTC)
As Bitcoin gains mainstream acceptance, many public companies are adding the asset to their treasuries. Companies like Strategy and Metaplanet have gone all-in on the flagship cryptocurrency, using it as a hedge against inflation, rising interest rates, and fiat debasement. However, critics have accused these companies of using Bitcoin as a speculative lifeline rather than a strategic asset. According to a report by BitBo, over 70 public companies hold Bitcoin as of June 6, with companies like Strategy and Metaplanet effectively acting as proxies for the asset. However, several companies are also strategically investing in the asset while continuing to focus on their primary business.
Analyst and journalist Sean Williams has raised concerns about the potential failure of companies building Bitcoin treasuries, highlighting a lack of innovation and operational success as drivers of a potential collapse. The analyst also called the Bitcoin treasury hype a “dumpster fire in the making.” The analyst highlighted that many companies pivoting to Bitcoin were not profitable in the first place, suggesting their efforts were to make a quick profit from crypto volatility. He also highlighted several instances when the Bitcoin price saw substantial declines as a potential risk for the company.
However, supporters believe corporate Bitcoin treasuries are grounded in strong macroeconomic reasons. Fidelity pointed out that companies are using Bitcoin treasuries as a successful hedge against inflation, fiscal deficits, and currency debasement.
Bitcoin Liquidation Risk Rises
Bitcoin (BTC) regained the $105,000 level over the weekend, recovering from Thursday’s sudden collapse that saw the price drop to a low of $100,421. The recent price action could inspire traders to bet on the price continuing its upward trajectory. An analysis from Rekt Capital stated,
“On the Daily timeframe, Bitcoin is showcasing signs of breaking its two-week Downtrend (light blue) while also turning it into support earlier today. Daily Closing & retesting ~$106600 (black) would be even better to enable trend continuation.”
Another analyst looked at order book liquidity to gauge price direction, summarizing that BTC’s liquidation cluster is signaling an upward move.
“BTC liquidation cluster is now signaling an upside move. If BTC pumps 10% from here, $15.11 billion in shorts will get liquidated. Meanwhile, a 10% downside move will liquidate $9.58 billion in longs.”
The analyst also predicted a move past $109,000-$110,000 for BTC next week. Other market watchers predicted a retest of the $100,000 support level, with popular trader CrypNeuvo stating,
“100k is the strongest psychological support so, as explained on Sunday, it's the area where I'm building some longs with easy invalidation below it.”
Bitcoin (BTC) Price Analysis
Bitcoin (BTC) is painting an inverse cup and handle pattern, with its neckline near $100,500 acting as support. A breakdown below this level could trigger a drop to $91,000, aligning with BTC’s 200-day EMA. To regain control, Bitcoin bulls must ensure the price remains above $105,000. A breakdown of current levels could significantly impact BTC’s chances of hitting $150,000 by the end of the year. However, BTC’s weekly chart is flashing a warning, indicating the formation of a bearish divergence between the price and the RSI, a pattern last seen during the 2021 cycle top, when the RSI trended lower despite higher price highs. That divergence gave way to a 61% correction. Analysts believe a similar structure is visible, with a divergence below $112,000 on the weekly chart.
BTC traded in the red most of last week, registering a marginal decline on Tuesday before falling 1.03% on Wednesday and settling at $107,834. Selling pressure intensified on Thursday as BTC fell over 2%, slipping below the 20-day SMA and settling at $105,662. Sellers retained control on Friday as the price fell 1.51%, falling below $105,000 and settling at $104,067. Despite the overwhelming selling pressure, BTC recovered over the weekend, rising 0.69% on Saturday and almost 1% on Sunday to reclaim $105,000 and settle at $105,775.
Source: TradingView
The price fell to an intraday low of $103,734 on Monday as selling pressure intensified. However, it recovered from this level to register a marginal increase and move to $105,903. Bearish sentiment returned on Tuesday as BTC fell 0.44% to $105,435. Sellers retained control on Wednesday as the price fell below $105,000 and settled at $104,755. Selling pressure intensified on Thursday as BTC plunged 3%, falling to a low of $100,421 before ultimately settling at $101,615. The price recovered on Friday, rising almost 3% to recoup its losses and settle at $104,378. BTC continued pushing higher on Saturday, rising over 1% to reclaim $105,000 and settle at $105,575. The current session sees the price marginally up as buyers and sellers struggle to establish control. Buyers have pushed the price past $106,000 during the ongoing session.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
