Bitcoin, the world’s leading cryptocurrency, has been struggling to surpass the $70,000 mark and reach a new all-time high (ATH). Despite hitting a seasonal peak of $73,000, Bitcoin has faced multiple obstacles, including market disturbances and significant sell-offs. With these issues now largely behind us, many are asking why Bitcoin hasn’t yet soared to $100,000. Here’s a detailed look at the current situation and why a potential price drop to $48,000 might be on the horizon.
As of today, Bitcoin is trading around $58,129. The daily chart reveals a troubling trend: the 20-day moving average (MA) has recently crossed below other MAs, sitting at approximately $59,800 and acting as a resistance level. Meanwhile, the 200-day MA has surged to the top and formed a “death cross,” a technical pattern often associated with bearish sentiment.
The weekly chart paints a similar picture. Recently, an evening star candle pattern appeared, suggesting that a significant downward movement may be imminent. This pattern, combined with rising bearish momentum on the MACD histogram, suggests that Bitcoin could be heading for a rough period. The 50-week MA, currently around $51,000, serves as the latest support, while the 20-week MA continues to act as resistance.
According to data from Coin glass, August and September have historically been bearish months for Bitcoin. In August 2024 alone, Bitcoin has already experienced a 10% decline. September has consistently been the most bearish month over the past decade, though October has often seen a rebound with positive movements. Historically, the fourth quarter tends to be bullish for Bitcoin.
The Fear and Greed Index is a crucial gauge of market sentiment, reflecting the prevailing psychology among investors. Last month, the index was at 69, indicating a high level of greed and investment in Bitcoin. However, this index has sharply declined since then, falling to 27 today from a previous low of 29. This drop signifies growing fear among investors, who are now hesitant to buy Bitcoin at current levels.
Data from Into The Block reveals that 75% of Bitcoin investors are currently in profit. If the market turns bearish, these investors are likely to lock in their gains. Conversely, 18% of investors who bought Bitcoin at higher prices are already at a loss, while only about 7% of investors purchased Bitcoin within the current price range of $48,094.75 to $58,497.51.
If Bitcoin’s price begins to decline, there are approximately 6.28 million addresses holding a total of 2.34 million BTC, with purchase prices between $37,653.38 and $48,094.75. These investors might decide to sell if prices drop, potentially exacerbating the downward trend.
The Bitcoin liquidity heatmap shows that the nearest liquidity point is below the current price. This suggests that a decline is likely. If Bitcoin begins to fall, investors holding at the money may sell off their positions, causing further downward pressure. The next liquidity point is around $56,000, which could serve as a new support level if the price continues to drop.
Recent data from Arkham Intelligence highlights movements of Bitcoins seized by the U.S. government from the Silk Road case. The government had previously planned to sell the entire 50,000 BTC in multiple transactions but has only offloaded a portion so far. Recent transactions show that 10,000 BTC were transferred to Coinbase Prime, with the remaining funds still held in an unidentified wallet. This ongoing sell-off could contribute to market instability.
In summary, the current data and market indicators point towards a possible Bitcoin price drop to around $48,000. Bearish chart patterns, seasonal trends, and investor sentiment all suggest that a decline is likely. While retail investors might be feeling nervous, institutional investors and whales may see this as an opportunity to accumulate more Bitcoin.
Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.
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