Bitcoin tests $60,000 support as cycle model projects $40,000 bottom

Bitcoin is testing $60,000 support as of Aug. 2, with resistance at $63,500, while a cycle model projects a potential $40,000 bottom, according to Coinpaper.

Long-term holders have been accumulating during the recent dip, with wallets that have not moved coins in over 155 days adding to positions, according to on-chain data cited by Bitcoin World. Exchange balances have continued to decline, reducing available supply for trading.

The price pressure follows a turbulent week. Bitcoin fell nearly $3,000 to $62,369 on July 31 after failing to hold $65,000, wiping out $100 million in long liquidations and $360 million in leveraged positions across the crypto economy, according to Bitstamp data. U.S. spot bitcoin ETFs recorded roughly $265 million in net outflows on July 31, led by BlackRock's IBIT, while the Coldcard hardware wallet exploit drained 1,128.6633 BTC from over 1,100 wallets on July 30.

A daily close below $60,000 could trigger a wave of stop-loss orders and accelerate a decline toward $55,000, with the cycle model pointing to $40,000 as a potential bottom. Traders are also watching BIP-110 miner signaling beginning around Aug. 7 and the planned eCash hard fork on Aug. 21, both of which could inject additional volatility.

$265M ETF outflows and Coldcard drain hit sentiment

The Coldcard incident, in which attackers exploited a firmware flaw to drain over 1,100 wallets, has shaken confidence in self-custody hardware. Coinkite released patched firmware and instructed affected users to generate entirely new wallet seeds. The Crypto Fear and Greed Index remains in "Fear" territory, while open interest holds near $48 billion, suggesting existing positions are being unwound rather than new leveraged bets driving the decline.

Can $60,000 support hold?

The $60,000 level has been tested multiple times over the past week and has held so far. A decisive break below this level would likely shift attention toward the $58,000 to $60,000 zone, which attracted meaningful demand earlier this summer. On the upside, recovering the $64,000 to $65,000 range would suggest buyers are absorbing the recent wave of negative headlines. The RSI is hovering around 45, indicating neutral momentum with room for upside before reaching overbought conditions.

The combination of security concerns, persistent ETF outflows, and legislative uncertainty in Washington — where the CLARITY Act's 2026 passage odds have fallen to roughly 30 percent from over 80 percent in February — leaves Bitcoin without its strongest sources of demand. If the $60,000 support fails, the path toward the cycle model's $40,000 projection becomes increasingly plausible, with altcoins and crypto-related equities likely to face amplified selling pressure.

This article is for informational purposes only and does not constitute investment advice.