Bitcoin's (CRYPTO:BTC) recent price action has sparked concerns as it plunges below crucial support levels, including the significant $60,000 mark and the 200-day moving average, currently at $58,000.

Analysts suggest that failure to reclaim these levels could signal further downside potential for the cryptocurrency.

On the daily chart, the breach of these supports is viewed as a bearish signal, potentially indicating a deeper correction ahead if the $57,000 support fails to hold.

However, on shorter timeframes like the 4-hour chart, oversold conditions and signs of stabilisation near $57,000 offer a glimmer of hope for a temporary recovery towards $60,000.

Market sentiment remains cautious, with funding rates turning negative as investors exit long positions and consider short strategies, a pattern that historically precedes market bottoms.

While volatility persists, observers speculate on the possibility of a rapid rebound if short liquidations trigger a swift recovery in Bitcoin's price.