Bitcoin bulls might have reason to cheer, with the German government’s Bitcoin fire sale nearing its end. This significant selling pressure, combined with technical indicators, suggests a potential local bottom for the leading cryptocurrency.
Just three weeks into its Bitcoin disposal program, the German government’s wallet has dwindled to a mere 3,856 BTC. This aggressive sell-off, totaling $222 million, has undoubtedly contributed to Bitcoin’s price dip below $60,000 in recent weeks. However, with the majority of the coins sold, selling pressure is expected to ease, potentially paving the way for a price recovery.
The German government confiscated these Bitcoins in February 2024 from Movie2k, a notorious pirate movie website. The proceeds from the sale are likely to be directed towards government initiatives.
The depletion of the German government’s Bitcoin reserves could be a turning point for the cryptocurrency’s price. Technical analysis using the Wyckoff Method, a price action-based trading strategy, suggests a potential bottom is forming. Popular crypto analyst Moustache leverages this method and predicts an imminent price rise above the psychological $60,000 barrier.
“I think we will see BTC back above $60,000 very soon,” Moustache stated in a recent social media post.
Beyond the Wyckoff analysis, other technical indicators also hint at a potential bottom. Crypto trader MartyParty shared a chart highlighting the “Coinbase Premium,” which measures the price difference between Bitcoin on Coinbase (a popular exchange among US investors) and Binance (a global exchange). A positive Coinbase Premium suggests stronger demand for Bitcoin in the US compared to the rest of the world, potentially indicating a buying opportunity.
Will Bitcoin Reclaim $60,000?
While the German government’s dwindling Bitcoin reserves and supportive technical indicators offer a glimmer of hope for Bitcoin bulls, some uncertainty remains. The cryptocurrency needs to hold above the critical support level of $56,700 to solidify a price bottom and fuel a sustainable recovery.
The coming days will be crucial in determining Bitcoin’s next move. If the price manages to stay above $56,700 and surpass the $60,000 resistance zone, a more convincing bullish scenario could unfold. However, a break below $56,700 could signal a further price decline.
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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.
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