Bitcoin’s price has recently dipped below a significant trend line, sparking concerns about the future direction of the leading cryptocurrency. As the US inflation report looms, Bitcoin has encountered bearish pressure, particularly in the $95K-$100K range, with heavy sell-offs pushing the price down. On-chain data, however, presents mixed signals, indicating that traders from both bullish and bearish camps continue to influence Bitcoin’s price movements.
The market has been further unsettled by reports that Binance, a leading cryptocurrency exchange, had liquidated nearly all of its Bitcoin, Ether, Solana, and other digital assets. This, combined with rising liquidations in the market, has created additional volatility. Bitcoin’s price has recently fluctuated around $98K and then corrected to $95K, triggering concerns of a deeper downturn. According to Coinglass data, Bitcoin’s total liquidations reached $32.21 million, with buyers losing around $23.7 million and sellers at $8.41 million.
Despite the recent correction, certain metrics hint at a potential rebound. The MVRV (Market Value to Realized Value) ratio, a key on-chain indicator, dropped as Bitcoin’s price rose, suggesting that long-term holders are cashing out on their profits. This could be contributing to the current pullback. Additionally, Bitcoin’s volatility has decreased from 38.12% to 33.52%, which may suggest a period of price consolidation before the next big move. Analysts are split, with some viewing the correction as an opportunity to buy at a discounted price, anticipating a rebound if Bitcoin reaches a solid support level.
Looking ahead, Bitcoin is facing a challenging resistance level, particularly around the 23.6% Fibonacci retracement. The price recently tested $98K but has since consolidated and is now attempting to hold the $95K level. If Bitcoin fails to stay above this support, there’s a chance it could test the $91K level next. However, a bounce above this key threshold could trigger a rally towards $98K and potentially $102,000. Should Bitcoin fall below the $89K mark, further downside pressure could prevail, indicating a potential retest of lower levels. Traders and investors will be watching closely to see if Bitcoin can maintain its support or if it’s headed for a deeper correction.
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