Bitcoin’s recent price volatility has concerns of a potential 75% market correction as crypto whales offload significant amounts of BTC. Over the past 24 hours, Bitcoin briefly dropped below $59,000 before rebounding to just above $60,000. Despite this recovery, the flagship cryptocurrency remains under pressure, with bearish signals continuing to dominate market sentiment.
Bitcoin’s failure to consistently stay above key support levels, such as the 50 and 200-day Moving Averages (MA), indicates a growing bearish outlook. This week’s price movement has left investors wary, as the total crypto market cap has dropped by around 2%, now hovering at approximately $2.21 trillion. Within the same period, nearly $200 million was liquidated from leveraged crypto trades, particularly affecting long positions.
The primary factor behind this bearish momentum is the activity of crypto whales. In the past three days alone, Bitcoin whales have sold over 30,000 BTC, equivalent to nearly $2 billion. This large-scale sell-off has raised alarms about a potential price correction, particularly as these major players take profits, putting downward pressure on the overall market.
The recent sell-off by Bitcoin whales comes at a time when U.S. spot Bitcoin ETFs are also experiencing significant outflows. On Thursday, the market saw a net cash outflow of over $109 million from U.S. Bitcoin ETFs, with Fidelity’s FBTC leading the withdrawals. The simultaneous selling pressure from both whales and institutional players is adding to the uncertainty in the market.
Additionally, Ethereum is also facing selling pressure, particularly due to the anticipated $1.3 billion Ether sell-off by the Chinese government. Along with this, the Ethereum Foundation and U.S. spot ETH ETFs have been offloading large amounts of Ether. On Thursday alone, U.S. spot Ether ETFs registered a net outflow of nearly $15 million.
Adding to the market’s instability is the growing use of leverage trading. According to data from Crypto Quant, leverage trading in the crypto market has reached its highest level in a year. This increase in borrowing to place larger bets can amplify market volatility, potentially leading to even bigger price swings. Market analyst Ali Martinez has pointed out that the heightened leverage use suggests the market may experience more extreme movements in the near term.
This uptick in leverage trading coincides with a broader sense of caution within the crypto space. As investors take larger risks with borrowed funds, the likelihood of sharp price fluctuations becomes more probable. If Bitcoin’s price fails to maintain key support levels, the potential for a steep correction could become a reality.
Veteran trader Peter Brandt has warned that Bitcoin could be at risk of a severe correction. He pointed out that it has been 30 weeks since Bitcoin last reached an all-time high (ATH), a period that has historically preceded significant price declines. According to Brandt, whenever Bitcoin fails to break through to a new ATH within this time frame, a decline of 75% or more has often followed.
Brandt’s analysis adds weight to the growing concerns surrounding Bitcoin’s price trajectory. Despite favorable macroeconomic conditions, such as a recent U.S. Federal Reserve rate cut and a surge in gold prices, Bitcoin has struggled to gain upward momentum. The prolonged bearish sentiment, combined with whale sell-offs and ETF outflows, could push Bitcoin into a major correction if the market fails to stabilize.
As Bitcoin faces mounting selling pressure from whales, ETFs, and heightened leverage trading, the market is bracing for more volatility in the short term. The key question is whether Bitcoin can hold its ground above critical support levels or if a larger correction is on the horizon.
While the broader crypto market has experienced numerous corrections in the past, Bitcoin’s resilience has often shone through. However, with prominent traders like Peter Brandt signaling the possibility of a 75% drop, investors are on edge. The coming days and weeks will be crucial in determining whether Bitcoin can weather the storm or if the market will witness another major price collapse.
Bitcoin’s recent price activity highlights the growing tension between bullish hopes and bearish realities. With whales selling off large amounts of BTC and the use of leverage trading reaching new heights, the potential for a significant correction looms large. As market watchers like Peter Brandt caution against a further decline, Bitcoin’s ability to navigate these turbulent waters will be key to its short-term future.
Steven is an explorer by heart – both in the physical and the digital realm. A traveler, Steven continues to visit new places throughout the year in the physical world, while in the digital realm has been instrumental in a number of Kickstarter projects. Technology attracts Steven and through his business acumen has gained financial profits as well as fame in his business niche. Send a tip to: 0x200294f120Cd883DE8f565a5D0C9a1EE4FB1b4E9
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