This article is also available in Spanish.
Bitcoin faced significant selling pressure after it successfully crossed the $100,000 level, a psychological milestone that sparked investor optimism. However, the celebration was short-lived as Bitcoin failed to maintain this critical level, falling to a low of $92,500 in less than three days. This sharp decline has raised concerns about market stability and Bitcoin’s ability to maintain its upward momentum.
Related reading
Axel Adler, one of CryptoQuant’s leading analysts, shared valuable insights into recent market activity. He revealed that the largest debt reduction process last week occurred between January 6 and 7, when the price of Bitcoin fell from $102,000 to $100,000 due to liquidation operations. This wave of forced selling sent prices lower, allowing the bears to regain control and push the price of Bitcoin further down to $92,500.
Current market conditions have left investors wondering what’s next for Bitcoin. Will it stabilize and find support to start another rally, or will downward momentum lead to a deeper correction? With market sentiment oscillating between fear and cautious optimism, all eyes remain on Bitcoin as it navigates this critical phase.
Bitcoin is regaining ground after a violent sell-off
Despite experiencing a sharp decline that took Bitcoin to $92,000, the cryptocurrency has managed to find major support at this critical level. In the past few hours, Bitcoin has surpassed this threshold, rising to $95,000, providing a glimmer of hope for optimistic investors. The ability to withstand and bounce back from this support level indicates potential resilience, but doubts remain.
Leading CryptoQuant analyst Axel Adler shared insightful data with X about the recent market dynamics. He pointed out that the largest debt reduction in the past week occurred between January 6 and 7, when the price of Bitcoin fell from $102,000 to $100,000 due to a wave of liquidations. This liquidation event wiped out highly leveraged positions and paved the way for bearish activity. Taking advantage of the chaos, the bears opened short positions, taking the price down to $92,000.
Despite the recent recovery, Adler warns that the current 9,000 BTC reduction in open interest (OI) does not provide a definitive signal for easing pressure in the market. This leaves Bitcoin’s next move uncertain, as investors closely watch how price action develops in the coming days.
Related reading
A recovery to $95K is a positive sign, but BTC must recover to higher levels to confirm bullish momentum and stabilize the market. Until then, traders remain cautious as the potential for further volatility looms on the horizon.
BTC holds key level: high bull zone
Bitcoin is trading at $95,000, holding above a critical support level and holding just 2% below the 4-hour 200 EMA at $96,200. The 200 moving average, another important indicator, is located 3% away, which adds additional importance to Bitcoin’s current situation. These technical levels are pivotal for assessing short-term market momentum and a potential bullish recovery.
For the bulls to regain the upside, the $95K level must remain a basis for further upward movement. A decisive push to reclaim the $98K and $100K levels is crucial. These price points act as key resistance levels, which, once crossed, could pave the way for a strong rally, paving the way for Bitcoin to revisit its all-time highs.
Failure to hold above $95K could open the door to increased bearish pressure, which could send BTC into a deeper consolidation or even test lower demand areas. However, holding the line at current levels and building momentum can restore investor confidence and create the conditions for a sustainable rally.
Related reading
As Bitcoin consolidates, traders and analysts alike are closely monitoring these critical levels to gauge what’s next for the cryptocurrency. A break above the $100k mark could reignite bullish sentiment and set a more defined direction for the market.
Featured image by Dall-E, chart from TradingView
Comments are closed, but trackbacks and pingbacks are open.