After a recent market drop, the price of Bitcoin (BTC) has reached $56,092, marking a 4% decline over the past week. Analyst Ali Martinez warned of a potential further drop.
Possible Drop to $40,600
According to Martinez's latest analysis, the TD Sequential indicator on Bitcoin’s 2-month chart has issued a sell signal. This suggests a potential further decline to $40,600 if the $51,000 support level is lost.
Decline in Bitcoin Active Addresses
Adding to the concern, CryptoQuant analyst known as 'Avocado onchain' observed that Bitcoin's price is not following the usual downturn pattern seen in past cycles. Instead, Bitcoin is trading sideways within a large range without a clear direction.
Current Situation Analysis
The number of active Bitcoin addresses, representing the total number of users on the network, has significantly declined since the start of 2024. This pattern mirrors declines observed after Bitcoin’s price peaked in previous bull markets, such as in 2017 and 2021. The sharp drop in wallet activity indicates that people have stopped making transactions and have essentially 'locked up' their wallets, signaling a shift to long-term holding.
The potential drop in Bitcoin's price to $40,600 is causing concern among traders and investors. Uncertainty in price movements is further supported by the decline in address activity, which may indicate a shift to long-term asset holding.
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