- Selling pressure on Bitcoin had subsided, indicating a trend reversal.
- BTC is up over 1% in the last 24 hours and a few indicators looked bullish.
Last week was not in the best interest of Bitcoin [BTC] investors, as the king of crypto lost a significant portion of its value. The price correction pushed the coin’s value below the $40,000 mark again.
The misery didn’t end there, however; the latest data suggested that if BTC continues to fall and falls below $38,000, things could get even worse.
Bitcoin needs to recover from this carnage
CoinMarketCaps facts revealed that the price of the king of cryptos has fallen by more than 6% in the last seven days. IntoTheBLock also posted a tweet stating how this price correction affected investors.
According to the tweet, Bitcoin’s price drop to $39,000 affected investor sentiment, especially as nearly 23% of BTC addresses had suffered losses.
This was a significant increase from just 13% compared to the previous week.
Bitcoin’s price drop to $39,000 has particularly affected investor sentiment. Currently, approximately ~23% of Bitcoin addresses are in a losing position, a significant increase from just 13% a week ago.
Our analysis of the in/out money indicator shows that there is significant resistance… pic.twitter.com/FaT0emmjSy
— IntoTheBlock (@intotheblock) January 23, 2024
Bitcoin drops below $38,000?
However, the good news was that Bitcoin’s price action showed signs of recovery. It is striking that the value of the coin has risen by more than 1% in the past 24 hours.
At the time of writing, it was trading at $39,923.35 with a market cap of over $782 billion.
Even better news was revealed by CryptoQuant analyst Mignolet, who said selling pressure on BTC was easing.
Source: CryptoQuant
The analysis noted:
“The selling pressure from the United States, which led to the price drop, is subsiding. In the current situation, there is a good chance of a quick price recovery.”
To check whether the selling pressure was actually waning, AMBCrypto looked at other data sets.
We found that BTC‘s net deposits on the exchanges were low compared to the average of the past seven days. This meant that investors were buying BTC again, indicating a soon price increase.
Source: CryptoQuant
The aforementioned data sets suggested that the chances of BTC rising above $40,000 this week were high. However, concerns remain as there is a chance of a continued price decline.
Notably, Ali, a popular crypto analyst, posted a tweet talked about Bitcoin’s importance to stay above the $39,800 mark.
If BTC continues to lose value and falls below the $38,000 mark, it could trigger another bear rally for the coin.
Read Bitcoins [BTC] Price prediction 2024-25
AMBCrypto looked at Bitcoin’s daily chart to gauge where prices might go.
Our analysis found that BTC’s Money Flow Index (MFI) and Relative Strength Index (RSI) recorded increases, indicating continued price appreciation. Nevertheless, the MACD remained bearish.
Source: TradingView