BTC Potential Decline: Exploring Four Possible Factors That May Cause Bitcoin to Retreat to $93K
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Bitcoin's Sketchy Ride: Here's What's Up, Y'all Intense Clash for Solana: Will It Break $170?
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Bitcoin's high-rolling journey recently returned to the $100,000 zip code, peaking at around $103,443 over the last 72 hours. It's been a minute since Bitcoin last closed above this level, going back to the 3rd of Feb, according to Binance's daily chart.
But while this price surge suggests an energetic bull run, the underlying factors signal that ol' Bitcoin might be losing steam.
Whales Aren't Feeling the Fire Anymore
Traders in the big leagues, also known as whales, are losing their bullish edge in the derivatives market. Historically, when Bitcoin ascends to the $103,000 zone, Open Interest tends to soar above $68 billion. But now, it's chillin' at $61.3 billion, demonstrating that these whales aren't opening as many positions as they used to.
The Whale Position Sentiment also hints at whales cashing out.
Since whales control substantial liquidity, selling from these giant traders can prompt short-term corrections in the Bitcoin market.
Where Will Bitcoin End Up, Man?
Our site dived deep into the Liquidation Heatmap to spot possibly lucrative liquidity pockets.
Liquidity clusters are key levels that usually pull in price action, represented by shaded areas on the chart.
If selling intensifies, it's possible that the price could nosedive into the $98,500 honey pot, hosting around $103 million in leverage. Worse yet, a deeper drop can take us to the cluster between $93,400 and $92,900, containing $500 million in leverage.
What's Dragging Bitcoin Down?
The dark clouds hanging over Bitcoin don't stop at whale sell-offs. They also include:
- The Exchange Whale Ratio, rising to 0.4, suggesting heightened whale activity on centralized exchanges.
- Whale Inflows to Exchange Wallets show a spike, with hefty transfers to market heavyweights like Coinbase and Robinhood aplenty. These moves usually suggest impending sales.
- The BTC/ETH chart is looking bearish, indicating that investors are shuffling funds from Bitcoin to alternative assets such as Ethereum.
Bottom line, if whales keep offloading their coins and liquidity keeps leaving Bitcoin, this cryptocurrency may hit some nasty lows.
Take a Survey: Chance to Win $500 USDT Bitcoin's growth can stall at $150K, here's why - Michael Saylor Solana's Critical Edge as Bulls and Bears Test $170
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[enrichment data:
Overview:
Several factors could result in a short-term correction for Bitcoin, while traders and analysts are closely monitoring key liquidity zones to assess support and resistance levels.
Factors Contributing to a Potential Short-Term Correction:
- Technical Resistance and Consolidation Zones: Bitcoin's consolidation below a resistance area around $95,000, established by March highs, indicates a period of price stabilization before a further move, which often precedes a short-term pullback or correction.
- Breakdown Below Short-Term Support: The critical short-term support is around the $102,000 level, and a breakdown below this range could trigger a short-term correction, potentially pushing the price toward $99,000.
- Normal Market Volatility and Profit Taking: Bitcoin has exhibited brief price declines, such as the 4.3% decline over three days after nearing $97,900, which demonstrates normal market volatility and profit-taking behavior.
- Institutional and Market Sentiment: Strong institutional interest supports the medium to long-term bullish narrative, but short-term market corrections are common amid ongoing consolidation and market fluctuations.
Key Liquidity Zones to Watch:
- Support Levels:
- $90,000 to $92,000: A consolidation floor in recent months and a solid support range.
- $89,000: Reflecting January 2025 lows and March and April local peaks.
- $82,000 and $78,000: Additional support layers in case prices fall below higher levels.
- $74,000: Significant support zone marking early April lows and currently viewed as the boundary separating bullish and bearish sentiment.
- Resistance Levels:
- $104,000 to $109,000: Corresponding to late 2024 and early 2025 local peaks.
- $100,000: A key psychological resistance level.
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- The recent surge in Bitcoin's price has brought it back to the $100,000 zip code, but the underlying factors suggest a potential unwinding of the bull run.
- Whales in the derivatives market are losing their bullish edge, which could prompt short-term corrections as they cash out.
- The Liquidation Heatmap shows possible liquidity pockets, particularly the $98,500 honey pot, hosting around $103 million in leverage, which could be a target for a price nosedive.
- The Exchange Whale Ratio is rising, indicating heightened whale activity on centralized exchanges, and whale inflows to exchange wallets show a spike, suggesting impending sales.
- The BTC/ETH chart is looking bearish, indicating that investors are shuffling funds from Bitcoin to alternative assets like Ethereum.
- The likelihood of Bitcoin dropping further is high, especially if whales continue to offload their coins and liquidity keeps leaving the cryptocurrency.
- Dolapo, a cryptocurrency trader, is closely watching these key zones and has created a heatmap to monitor the situation in the finance market while investing in crypto assets.
