Bitcoin is increasingly likely to retest its yearly low near $59,000, raising market caution about further declines.

Cointelegraph, a blockchain media outlet, reported on June 19 that liquidity is concentrated below $59,000, which could trigger a short-term sharp drop. But supply-demand indicators such as falling exchange inflows are warning against overly bearish forecasts.

Bitcoin has failed in a recent rebound attempt and has not regained a key resistance line. Sellers regained the upper hand around the 50-day and 100-day exponential moving averages, pushing the price below an ascending channel. On a 4-hour chart, a break from a bearish structure was confirmed. The market is looking first to internal liquidity support near $60,700, and then to the yearly low of $59,000 as the next support zone.

In particular, more than $4.0 billion in leveraged long positions are clustered near $59,000 on a cumulative basis. If the price falls into this zone, forced liquidations could occur in a chain reaction, potentially clearing out long positions entered late. On the other hand, more than $4.75 billion in positions are also stacked near $68,000. That has prompted views that if a rebound follows lower-end liquidations, the price could again target the upper liquidity zone.

Technical indicators are also approaching extreme levels. The relative strength index (RSI) has fallen close to oversold territory. If the price is pushed once more toward the yearly low, the indicator could drop below 30. If liquidations then finish, the possibility of a short-term rebound has been raised.

Some in the market say further downside is possible but warn against one-way bearish bets. Crypto analyst Killa said Bitcoin could move before fully sweeping the liquidity pool below $60,000. The view is that the market sometimes moves in the opposite direction without passing straight through price levels that many participants are watching. Trader LP also said, "There is no need to view this flow as overly bearish," and mentioned that the likelihood of a bottom forming increases toward the end of June.

Supply-demand indicators show selling pressure has eased somewhat. According to CryptoQuant analyst Amr Taha, exchange inflows by mid-sized Bitcoin investors fell simultaneously on June 19 at Binance, Coinbase and Coinbase Prime. About 3,500 BTC flowed into Binance, about 3,000 BTC into Coinbase and about 1,700 BTC into Coinbase Prime, all the lowest levels since April 4.

Exchange inflows are typically used as an indicator of immediate selling intent. A decline in coins sent to exchanges means fewer coins are waiting to be sold in the short term. Still, this trend alone makes it difficult to say new buying demand has emerged. It shows that mid-sized holders reduced exchange transfers while Bitcoin traded around $62,000.

In this situation, the market is focused on whether large-scale liquidations actually occur in the liquidity zone near $59,000 and whether easing sell pressure on exchanges leads to lower-end support. In the short term, the possibility of a retest of the yearly low remains open, but supply-demand data is also signaling it is difficult to conclude that a decline will immediately lead to a breakdown in the trend.

At some point, $BTC is going to front run major HTF liquidity. Just like the market front ran the 140K liquidity above, it can do the exact same thing on the downside, leaving many in complete disbelief. I'm not saying we won't sweep below 60K, but it's something worth… https://t.co/BOcXcVirFM pic.twitter.com/hxRgOVqkpM