Bitcoin price drop on January 8 and bearish engulfing candlestick pattern
A bearish engulfing candlestick pattern is generally considered a strong bearish signal that appears after an uptrend, indicating that the market may be about to reverse downward. Bitcoin experienced its second-largest intraday drop in nearly 19 weeks on January 8, forming a bearish engulfing candlestick pattern, suggesting strong bearish forces in the market, which could continue to put downward pressure on Bitcoin's price in the short term.
Stablecoin supply and market liquidity
Stablecoin supply enters a 'price discovery' phase, meaning there is more liquidity available in the crypto ecosystem, with potentially more funds flowing in over the next few months. Market analyst Jamie Coutts also believes more liquidity will flow in, potentially leading to a rise in BTC price six months from now. This somewhat supports Bitcoin's price, but due to improved U.S. economic data causing weakness in stock and cryptocurrency markets, Bitcoin's price still saw a significant drop. Therefore, the impact of increased liquidity on Bitcoin's price may take some time to manifest.
On-chain data indicates the possibility of a Bitcoin rebound
From on-chain data, the probability of Bitcoin rebounding immediately after a 5.15% drop, which erased the gains from the previous four days, is not optimistic. Bitcoin has experienced 15 instances of a 5% or greater pullback, with only 3 instances of an immediate rebound, resulting in a 20% probability. Therefore, from a probabilistic perspective, BTC is unlikely to experience a strong immediate rise.
Market participants' views on subsequent price trends #比特币价格走势分析 #加密市场回调 #美国非农数据即将公布
- Cryptocurrency trader Krillin: Bitcoin may accumulate between $92,000 and $90,000 in January, then experience a market rally in the following month.
- Cryptocurrency and stock investor Jelle: It is expected that a low point near $90,000 will be reached before making new highs.
- Consequences of breaking below $90,000: If the daily close falls below $90,000, it may confirm a reverse head and shoulders pattern, leading to a deeper crash for Bitcoin, potentially dropping another 20%, with a price target of $71,500.
