After BTC broke through sixty thousand, it barely rebounded to touch 61950 before being smashed down directly, today it plummeted to around 58000. Bulls can't even get past the 62000 hurdle; to put it bluntly, bears have long been ambushed at 62000, and a push upwards by the bulls is simply serving meat on a platter.

Now the bulls only have 58000 as their last defense line, and if it cannot hold the market, it will accelerate downward. Don’t underestimate the significance of 58000; once it breaks steadily, it will trigger the liquidation of a whopping 1.6 billion dollars in long positions, and the chain reaction of forced liquidations could result in a big black candle.

Looking at the market structure, after breaking sixty thousand, a four-hour dome was completed, and a bearish flag on the daily line has formed, with the drop targets calculated from both technical patterns all pointing to 54000. Additionally, on-chain MVRV data supports this, as 54000 has historically been a strong support level, with several reference lines pointing at the same level; this is definitely not a coincidence. A look back at previous market trends reveals that 54000 to 55000 is the average holding cost for market participants. At the end of 2018, March 2020, and the FTX collapse in 2022, every major drop was supported in this range. Compared to this, 58000 is just a layer of tissue paper, easily pierced, with the real battle happening at 54000-55000.

Why can’t the bulls drive the market? Previously, they relied on positive news from the U.S. stock market for a brief spike, but as soon as they reached the 0.382 resistance level, they were suppressed by the bears. Currently, with inflation data exceeding expectations, massive capital flight from ETFs, and the dollar index hitting new highs within the year, a triple threat is pressing down, and the bulls simply do not have additional capital to hold the market; it’s not that they don’t want to rise, but they lack bullets.

After dropping to around 55000, there is a high probability of a rebound; there are trapped positions here, and long-term holding costs are clustered. Profit-taking from short positions combined with short-term bottom-fishing funds will create a repairing market, but everyone must be clear that this is just a breather during a major drop, not a bull market reversal. The rebound height is limited; at most it could reach 58000-60000, with the upper 62400 being blocked by the 200-week moving average, making it hard to break through.

Currently at about 59000, those holding high-position short positions can hold on with peace of mind. Don’t add positions recklessly or impulsively try to bottom-fish. Wait for a clear signal at 58000 before proceeding. If a four-hour candle closes with a significant bearish volume, confirming a break below 58000, then increase short positions, with the first target at 54000-55000, and set a stop loss uniformly at 59500 to prevent being swept by a rapid short-term rebound.

When the market drops to the 54500-55500 range, closely monitor the market; if a long lower shadow or a large bullish candle appears on the four-hour chart, it indicates that someone is buying heavily below. Take profits on 70-80% of short positions, and hold the remaining positions to wait for a rebound. If the subsequent rebound returns to the 58000 to 60000 range, as soon as there’s a spike followed by a drop, the rebound market is basically over, and it’s time to short again, with a long-term view of 48000-50000. If it drops to 55000 with a continuous shrinking bearish trend that can’t even hold the cost line, the bearish trend will only deepen, and short positions should be held looking towards lower ranges.

Lastly, let me emphasize, if 58000 cannot hold, there will be a rapid decline, and 54000-55000 is the critical battleground. Even if 55000 rebounds, it’s just a transfer station in the process of decline; don’t think that just because of a bullish candle it’s time to shout bottom reversal. Wait a bit longer, let the 58000 support show the outcome, and wait for clear K-line signals at 55000 before taking action; that’s the safest approach.

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