Bitcoin has faced a significant decline, shedding 30% from its all-time high of $109,590 due to selling pressure from short-term holders.
Current Market Correction
Bitcoin plunged to $77,041 during the week of March 9-15, before slightly rebounding. Bitfinex analysts note that the selling pressure comes from investors who acquired BTC in the past 7-30 days, who are facing unrealized losses and are thus more prone to capitulate.
Signs of Recovery and Institutional Investor Roles
After hitting its weekly low, Bitcoin slightly recovered to $84,357. However, the market's next move largely depends on institutional investors stepping in. Historically, a 30% drawdown has often marked a low before potential recovery.
Macroeconomic Influence
Beyond market factors, Bitcoin's volatility is influenced by the macroeconomic landscape, including decreased U.S. consumer confidence and ongoing trade war talks. This adds uncertainty despite recent U.S. initiatives to create a Bitcoin strategic reserve.
Although Bitcoin shows signs of recovery, the key to stabilization is active institutional investor participation amid a complex macroeconomic environment.
