Bitcoin sentiment has taken a sharp turn, moving from bullish optimism above the $100,000 mark to growing fear as the price hovers around $95,000. The long-awaited clean breakout after reclaiming the $100,000 level failed to materialize, leaving investors questioning the strength of the current uptrend.
Senior analyst Axel Adler shared insightful data about X, revealing a notable shift in profit metrics generated in the market. The average daily profit generated decreased from $136 million to $93 million, indicating a cooling off phase. Despite this decline, current realized profit levels remain comparable to the 2021 cycle highs, highlighting the continued strength and activity within the market.
This data underscores the duality of the current situation: while Bitcoin is still showing signs of resilience, the failure to maintain momentum above the $100,000 mark has created uncertainty in the market. Analysts and investors are now closely monitoring the $95,000 level, a crucial support area that could determine whether Bitcoin will regain its upward trajectory or face a deeper correction. The coming days will be crucial as the market seeks clarity and direction at this pivotal stage.
Bitcoin metrics determine the market picture
Bitcoin’s current phase is a consolidation phase, which is a typical behavior after breaking significant psychological and technical levels. Since Bitcoin crossed the $100,000 mark for the first time on December 5, the price reached an all-time high of around $108,000 before stabilizing consistently below the $100,000 threshold. This period of sideways movement has created mixed sentiment, with the bulls looking to rally again and the bears eyeing potential corrections.
Analyst Axel Adler shared critical insights about XWhich highlights the decrease in the average volume of profits generated from $136 million per day to $93 million per day. Despite this decline, Adler notes that these numbers are still comparable to the peak of the 2021 cycle, indicating strong market activity. Historical data reinforces this perspective, with September 2021 and 2024 seeing the beginning of small upward spikes when the average daily profits generated were around $15 million – a fraction of current levels.
It is important to note that Adler’s analysis is based on 30-day moving averages, which smooth out short-term volatility but also means that the actual profits made are much higher. For example, on November 21, 2024, one month after the rally began at $98,000, investors’ daily profits rose to $443 million.
These metrics suggest that while Bitcoin is strengthening, underlying market activity remains strong, laying the groundwork for a potential bullish continuation. If Bitcoin holds key levels, another rally to test or exceed recent highs could be on the horizon.
BTC Technical View: Key Levels to Hold
Bitcoin is trading at $95,400 after losing key levels, including the psychological mark of $100,000, the 4-hour moving average at $98,290, and the EMA at $96,480. This series of breakouts indicates a short-term downward price movement, raising investor concerns about the potential for further decline.
However, despite this strong selling pressure, some analysts suggest that this could be a move to generate liquidity before rising again. This type of volatility is not uncommon during consolidations near critical levels, especially after a big rally like the one Bitcoin experienced in December.
The $95K mark now acts as a pivotal support area for bulls. If BTC can maintain this level in the coming hours, it could signal the end of this bearish phase and pave the way for a quick recovery. A reclaiming of the $96,480 MA would be an encouraging first step, while a move above the $98,290 4-hour 200 MA would confirm a return to bullish momentum.
Market participants are watching these levels closely, as continued stability above $95,000 could reignite confidence and put Bitcoin back on its upward trajectory. However, failure to maintain this support may lead to deeper corrections in the short term.
Featured image by Dall-E, chart from TradingView