Bitcoin Pullback: Temporary Cool-Down or Start of Bear Market?
Bitcoin’s price recently experienced a significant drawdown, dropping below $58,000 over the past three days. While some may interpret this as the beginning of a bear market, it is more accurately described as a temporary cooling-off period.
Bitcoin Investors Are Still Focused on HODLing
- Bitcoin’s price took a hit in the last 48 hours after a period of consolidation.
- The drawdown across the crypto market led to a loss of nearly $600 million, causing concern among investors.
- On-chain metrics for BTC suggest that this decline was anticipated and is just a brief pause in the long-term uptrend.
- The Coin Days Destroyed (CDD) over 90 days indicates that long-term holders (LTHs) are expecting a price increase.
Low CDD levels suggest investors are more likely to accumulate BTC or refrain from selling due to the lower price, reinforcing optimism for recovery and indicating that the recent correction is simply a market cool-down.
BTC Price Prediction: Bullish Flag Persists
- Bitcoin currently trades at $57,444 after dropping below $60,000.
- The digital asset remains above the lower trend line of the flag pattern it has followed for two months.
- A flag pattern typically consists of a sharp price movement followed by consolidation forming a rectangular flag, with a breakout signaling an uptrend continuation.
- The target for Bitcoin’s price remains at $92,505 based on the pattern, with a more attainable goal of surpassing $73,700 for a push towards a new all-time high.
To achieve these targets, Bitcoin must convert the $71,800 resistance into a support level by breaking through the $68,500 barrier. Failure to do so could result in a breach of the lower trend line and a drop below $52,000, negating the bullish outlook.
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