Will Bitcoin retest $56,000? Galaxy warns: Key support levels are under pressure, market bottom is approaching

February 3 News, Bitcoin has recently shown weak rebounds, and market opinions on the future trend are becoming more divided. Alex Thorn, Head of Research at Galaxy Digital, stated that “reasons to push the price higher are still hard to find,” and in the coming weeks, there is a higher probability that Bitcoin will pull back to a key support zone.

Alex Thorn pointed out that Bitcoin may first fill a supply gap around $70,000, then test its “realized price” level of approximately $56,000. The realized price is considered the average cost basis of all Bitcoin holdings across the network. Historically, during bear market bottoms, Bitcoin has often found support near this area.

Data shows that Bitcoin rebounded about 3% this Monday, climbing back to around $78,000, but still about 39% below the high of $126,000 set in October last year. Meanwhile, Bitcoin broke below the 50-week moving average in November last year, with the 200-week moving average currently around $58,000. In multiple past cycles, when the price was below these two long-term moving averages simultaneously, it often marked a cyclical low and provided a better accumulation zone for long-term investors.

On-chain activity indicates that the significant accumulation by large holders and long-term investors remains limited, suggesting some funds may still be waiting for lower prices. However, Thorn also mentioned that profit-taking among long-term holders is slowing down. This change is often seen as a sign approaching the bottom, but potential selling pressure above could still limit short-term rebounds.

On the policy front, the U.S. Senate is discussing the Crypto Market Structure Bill, but progress has slowed due to insufficient bipartisan support. Thorn believes that even if the bill passes, the positive sentiment will likely benefit altcoins more than directly changing Bitcoin’s medium-term trend.

Overall, in the absence of strong catalysts and with a relatively weak macro narrative, topics such as Bitcoin price forecasts, support levels, and overall crypto market trends will continue to be focal points for investors. The market may keep oscillating around key cost zones.