Bitcoin Falls Below $100,000 Amid Market Correction
Bitcoin, with a market cap near $1.9 trillion, has recently dropped below the $100,000 mark. This decline occurred over three days, raising questions among investors and analysts about whether it signifies the end of the bull market or a healthy correction within an ongoing bullish trend.
Temporary Setback Or Trend Reversal?
This week's price action is significant as Bitcoin fell through the $100,000 support level, which had held for eight days. Analysts attribute this decline to market makers' strategies, which involved pushing the price upward to entice long positions at around $98,000, thereby increasing liquidity. After exhausting this liquidity, they used Federal Reserve Chairman Jerome Powell's speech as a catalyst to drive prices down, filling inefficiencies at $93,744 (50%) and $90,513 (100%).
Experts noted that this drop was necessary to address price inefficiencies. They predict a potential bounce back to $101,000 before either a pullback or continued upward movement, supported by strong buy orders in the $93,788-$92,200 range, which corresponds to the filled 50% inefficiency.
BlackRock And Institutional Moves Signal Confidence In Bitcoin
In the midst of volatility, BlackRock has made significant investments in Bitcoin, acquiring 122.6K BTC, making it the 11th largest holder, controlling approximately 0.6% of the circulating supply. Their aggressive accumulation contrasts with broader market trends, where net selling of Bitcoin reached $785 million this week.
BlackRock's recent $1.5 billion purchase and its BUIDL Fund receiving $100 million USDC indicate a strategic pivot towards digital assets, suggesting confidence in the long-term viability of cryptocurrencies and potentially influencing market sentiment.
Market Sentiment: Fear Or Opportunity?
The current market sentiment, indicated by the Fear and Greed Index, remains in the 'greed' zone at 62, reflecting minimal fear among investors. Many view the dip below $100,000 as an opportunity for buying, anticipating a recovery. Analysts forecast a rebound to approximately $101,000 before any major pullback or continuation of the trend, supported by robust buying in the $93,788-$92,200 range, aligning with the recently filled inefficiency levels.
Featured image from iStock, chart from Tradingview.com