The price of Bitcoin has shown reduced volatility, registering only a 0.23% gain in the past 24 hours. Market participants are anticipating Bitcoin's next major shift, with some investors fearing a bear market while others remain optimistic about its long-term outlook.
Bitcoin Shows Signs of a Trend Shift
Market analyst Ali Martinez pointed out that Bitcoin shows developing signs of changing its long-term directional trend. The main sign of a macro trend shift is observed through the Inter-Exchange Flow Pulse metric, which reveals Bitcoin exchange movements suggesting the start of a correctional phase in the market. The MVRV Ratio is a key metric because it signals when Bitcoin experiences negative momentum. According to Martinez, the historical movement of the MVRV Ratio has commonly indicated major developments for Bitcoin. The present market data supports the theory that Bitcoin is moving into a protracted bearish trend, as the crypto market observes large investors becoming more cautious, leading to a decline in their Bitcoin investments.
The Price of Bitcoin Faces Risk of Further Drops
Bitcoin is receiving considerably less capital than before, suggesting diminishing market sentiment. According to Glassnode data, Bitcoin capital inflows registered $135 billion during December 2024 but have decreased to a mere $4 billion at present. Similar inflow numbers were recorded in October 2023. Based on these developments, Martinez identified essential price threshold points that could act as stability factors for BTC’s market value. A significant support area exists between $66,000 and $69,000. Data from IntoTheBlock reveals that 313,000 BTC purchases occurred from 750,000 investors when the price of Bitcoin reached $69,000. Additional declines in Bitcoin's price may occur if it cannot stabilize above these support levels.
Bitcoin May Drop to $46,000 Soon
According to Martinez, the Bitcoin price may fall substantially as previous patterns continue. All previous Bitcoin price dips below the 50-week simple moving average throughout the last ten years resulted in market value falling to meet the 200-week simple moving average. The current value of the 200-week simple moving average sits at $46,000, indicating that Bitcoin could move toward this point in the case of bearish developments. The existing pessimistic market predictions face counter-evidence pointing to imminent recovery. According to Martinez, increasing global liquidity supply has usually triggered Bitcoin prices to bounce back. The current trend indicates Bitcoin may see a price increase toward mid-April when liquidity conditions strengthen.
Despite current concerns about further Bitcoin price drops, existing market conditions and global liquidity suggest a potential recovery. Investors continue to look for signs of Bitcoin stabilization and growth.
