Bitcoin (BTC) fell below $60,000, a key psychological support, on Thursday as losses in mega-cap tech stocks weighed on investors’ broader risk appetite, adding pressure to an already fragile crypto market.
BTC/USD daily performance chart against Nasdaq and S&P 500. Source: TradingView
The drop has triggered a classic bearish reversal setup that may push the BTC price below the $54,000 mark in the coming days.
Key takeaways:
- Bitcoin’s break below $60,000 has erased its June gains and triggered multiple bearish setups.
- Bitcoin’s daily rounded top and bearish flag breakouts project a downside target below $54,000.
BTC Rounded Top Breakout Indicates More Pain Ahead
The BTC/USD pair fell as much as 4.8% on Thursday, hitting an intraday low near $58,000 and erasing its entire June advance. The pullback also completed what appears to be a rounded top pattern on the four-hour chart.
BTC/USD four-hour chart following rounded upper bearish setup. Source: TradingView
In technical analysis, a rounded top forms when buying momentum gradually exhausts, causing the asset to move from an uptrend to a downtrend in an inverse U-shaped structure. The pattern is officially resolved when the price falls below the “neckline” or base support of the structure.
By measuring the distance from the top of the dome to the neckline and projecting that same distance downward from the breakpoint, analysts calculate a clear target.
For Bitcoin, this measured downside target sits just below the $54,000 level, representing an approximate 8.9% drop from current prices.
On the daily chart, Bitcoin has simultaneously caused a breakout of the bearish flag.
BTC/USD daily chart tracking bearish flag breakout setup. Source: TradingView
This secondary pattern independently projects an identical move towards the $54,000 area, adding substantial weight to the bearish case.
Bitcoin MVRV Bands Raise $54,000 Target Odds
Bitcoin’s on-chain price bands are also pointing to the same area of downside highlighted by the rounded top and bearish flag setups.
Glassnode’s MVRV price bands compare Bitcoin’s market price to its realized price, or the average price at which coins last moved on-chain. In simple terms, they show whether the market is trading at unusually high levels of profits or losses.
BTC MVRV price bands versus price. Source: Glassnode
On Wednesday, Bitcoin was trading near $60,997, while the 1.0 MVRV band, shown in green, was around $53,390. That level closely matches the downside technical target near $54,000, making it an important support zone if BTC extends its decline.
Related: Bitcoin Nearly Loses $59,000 as DXY Rises: Are Traders Bracing for More Pain?
However, a deeper sell-off could push Bitcoin towards the 0.8 MVRV band, shown in blue, near $42,700. Historically, the main Bitcoin bear market bottoms have formed around this lower blue band, where unrealized losses become extreme and the risk of capitulation increases.
