Although Bitcoin has successfully defended the psychological level of $60,000 in recent days and halted the previous thirteen percent correction, many analysts remain cautious. The combination of technical indicators, on-chain data, and macroeconomic factors suggests that the market may still be searching for its true bottom. These warning signals show that the risk of a deeper decline has certainly not disappeared yet.
You might also like: Euro stablecoins dominate the non-dollar market
Mining costs and realized price show room for decline
The first warning signal is the fact that Bitcoin is trading slightly below the estimated production costs of miners, which stand at $62,650. If the price were to fall even lower, the next significant support is represented by the net electricity costs of mining, hovering around $50,120. Added to this is the so-called realized price, the average purchase price of all coins in circulation, which currently sits at $53,600. In past bear cycles, Bitcoin has always dropped below this value for a certain period.
Interestingly, in the current cycle, Bitcoin has not spent a single day below its realized price, whereas in 2022 it was 179 days and in 2015 even over 300 days. If history were to repeat itself and the market experienced a decline of 20 to 30 percent below this level, the price would find itself in the range of $37,500 to $42,800. Many miners are currently operating close to their breakeven point, which has historically often served as a zone for determining long-term value.
Read more: Anycoin review
MVRV model and bearish flag on charts
A similar conclusion about a decline is also reached by the on-chain MVRV model, which compares Bitcoin’s market value to its realized value. This indicator is currently below the lower valuation band and is heading toward a significant support area around $50,000, where it overlaps with the realized price and other indicators. It is precisely this convergence of multiple different analytical methods that makes the zone between $50,000 and $53,600 one of the most watched areas for a potential bottom.
Another argument for caution is technical analysis, as a bearish flag formation is forming on the weekly chart, which often appears after a significant decline and signals a continuation of the downtrend. Bitcoin failed to hold the 50-week moving average and is now testing the 200-week moving average at the $62,000 level, while the RSI indicator is moving near the oversold zone. Although institutional adoption and spot ETFs may change historical patterns, the $60,000 level remains the key threshold for the coming weeks.
Don’t miss: BITmarkets.com: Crypto exchange review rewriting the rules
