Bitcoin fell to a six-week low at the start of the week, dropping below the $60,000 mark overnight for the first time since early May.
The king cryptocurrency has rebounded to $61,176 during Asian and European trading.
Some investors seemed worried about the effects of the defunct bitcoin exchange Mt Gox starting to distribute bitcoin repayments from next month.
The Japanese lawyer designated the rehabilitation trustee, Nobuaki Kobayashi, said he was preparing to make repayments in Bitcoin to start "from the beginning of July 2024".
Neil Roarty, analyst at Stocklytics, noted that some bears were arguing there had been "a fundamental shift in both market and mood", with BTC no longer appearing to track the Nasdaq after it soared to record highs last week.
"At the same time, rumours swirl that whales - including some of the biggest miners and even the German government - are offloading their holdings," Roarty said.
If the negative sentiment prevails, he said "nothing’s off the table" for how far the world's largest cryptocurrency could slide, but the symbolic $50,000 mark was "a near-term possibility".
The extended BTC losses set off alarm bells for bulls as prices approached the $60,000 support line, said currency analyst Lukman Otunuga at FXTM as "a negative mood [was] enveloping the crypto space.
"Sentiment seems fragile with bears on standby to deliver a crippling blow at any given opportunity."
He said the Biden vs Trump presidential TV debate on Thursday and more US inflation data on Friday "could rock Bitcoin", especially if there is "any mention of crypto policy during the debate or an inflation report that shifts Fed cut bets could inject Bitcoin with more volatility".
After BTC rebounded, market analyst David Morrison at Trade Nation said "It feels as if it’s too early to sound the ‘all clear’ as the momentum remains to the downside, for now".
Bitcoin is down 6.2% over seven days, while Ethereum (ETH) is down just 0.85% after a 1.35% rise over 24 hours.
The only ones of the top ten largest crypto coins by market cap to be up over seven days are Solana (SOL), up 0.7%, dogecoin (DOGE), up 3.5%, and toncoin (TON) and cardano (ADA) both up over 5%.