Bitcoin Price Forecast: BTC to stay above $60k amid Middle East Crisis

Bitcoin (BTC) price slid to a 40-day low of $60,778 on April 13, before a sharp rebounding above $64,200 on Sunday, April 14. Despite the widespread fears surrounding the Middle-East crisis, majority of BTC investors are looking to HODL.

As the selling pressure drops, what are the chances of BTC price staying above $60,000 in the week ahead?

Bitcoin Market Supply has Reduced by 27,000 BTC in April 2024

Bitcoin price tumbled to a 40-day low on April 13, as flaring geo-political tensions in the Middle East triggered more than $300 million BTC liquidations within a frenetic 72-hour period.

Interestingly, recent on-chain data trends suggests that a large part of 16% Bitcoin price decline since April 10 was due to cascading effects of stop-loss triggers and rapid liquidation of leveraged LONG BTC positions.

Looking at BTC spot market supply trends since April 1, it appears that recent Bitcoin price crash may have been overblown, relative to investors’ optimism.

CryptoQuant’s Exchange Reserve chart below tracks real-time balances of total BTC coins currently deposited across recognized crypto exchanges and trading platforms.

This serves as proxy for monitoring the current supply of BTC readily available to be traded on the spot markets.

Bitcoin market supply across various exchanges stood at 1,973,702 BTC at the close of March 31, 2024. But that figure has now dwindled by 27,000 BTC to hit 1,945,615 BTC at the time of publication on April 14.

Valued at the 20-day Simple Moving Average (SMA) price of $68,000 per coin, BTC investors have effectively reduced the market supply by over $1.8 billion since the start of April 2024.

When market supply of an asset drops rapidly by such a large margin during a period of heightened market uncertainty, as observed above, it signals that majority of investors have taken an optimistic sit-and-watch stance rather than exit their positions en-masse.

Now, considering that BTC market supply has remained relatively flat in recent weeks, it implies that majority of the sell-pressure came from swing traders, and forced liquidations, but evidently, not from long-term holders flooding the markets.

BTC Price Forecast: $70k Rebound Hopes Hanging on ETF Flows

Looking ahead, if the SEC-approved Bitcoin ETFs begin the week with positive net-flows on Monday April 15, and geo-political tensions ease up, BTC price could be set for a last-minute rally toward $70,000 before the April 19 Halving event.

But Coinglass Liquidation map which depicts the value of active leveraged positions at key price levels shows that Bitcoin recovery could hit a major roadblock at the $66,000 territory.

As seen above, the bears stand to lose over $1.57 billion in SHORT liquidations if BTC price surges past $66,084 in the near-term.

Considering, the high volume of active futures trades opened at that territory, BTC could witness intense selling pressure, likely pushing prices towards $62,000, as the contract holders move to mitigate downside by exiting early or initiating stop-loss orders.

But with the halving rolling around in less than 5-days, and market supply trending low, any surge in market demand from the Bitcoin ETFs and other key stakeholders could trigger a parabolic breakout towards $70,000 in the week ahead as predicted.