Will Bitcoin Crash Again?

Bitcoin (BTC) is trading around $83,000 on March 13 after breaking the bottom of $76,600 on March 11. After strong fluctuations, BTC price recovered but failed to surpass the $84,000 zone. This has market analysts worried about the next crash Bitcoin may face.

Demand for Bitcoin remains weak

Statistics show that outflows from Bitcoin ETFs (Exchange Traded Funds) played a big role in the price drop in late February. Over the past two weeks, $1.5 billion has flowed out of Bitcoin ETFs.

Demand for Bitcoin remains low, according to data from market analytics firm CryptoQuant, which means potential investors’ appetite for the world’s most valuable cryptocurrency has weakened.

Bitcoin Demand Chart Is at Alarming Lows

PHOTO: CRYPTOQUANT SCREENSHOT

Market observers noted that demand for Bitcoin accelerated from November to December 2024 due to the “Trump victory effect”. However, by the end of February, the indices had all fallen sharply. Expectations for policies related to the strategic Bitcoin reserve fund and the first White House Crypto Summit collapsed, leading to a depressed market sentiment.

CryptoQuant believes that if this trend continues, Bitcoin prices could fall even further, similar to the crash in July 2024. At that time, Bitcoin fell 30%, then bottomed out at $49,000 on August 5, 2024.

Bitcoin could slide further

Data from Cointelegraph Markets Pro and TradingView shows that the current Bitcoin price is still 7% higher than the low of the last 4 months. However, CryptoQuant believes that this recovery is not enough to ensure further price increase. On the contrary, a stronger price correction is likely to occur.

The Bitcoin Bull/Bear Index is at its “deepest point of decline” of the cycle. A reading above zero indicates a bull market, while a reading below zero indicates a bear market. The index is currently at -0.067, its lowest level since May 2023.

Bitcoin Symbol Coin

Meanwhile, the MVRV Z-score, which measures Bitcoin’s valuation, shows that the bullish trend has lost momentum. Historically, valuation figures at this level have signaled a sharp correction or the start of a bearish cycle.

Based on the indicators, CryptoQuant believes that if Bitcoin fails to hold the $75,000 - $70,000 support zone, the price could plummet to $63,000.

Short-term investors flee

Blockchain analytics firm Glassnode said that people who bought Bitcoin when it peaked at $109,000 in January are now looking to sell. Data released on March 11 showed that it was the sell-off by those who “chased at the top” that caused Bitcoin to slide.

“Investor uncertainty is affecting community confidence,” Glassnode noted. Glassnode said short-term holders are under significant price pressure, and if the sell-off continues, Bitcoin could be pushed to a low of $70,000.

Glassnode explains a similar Bitcoin sell-off pattern emerged in August 2024 when BTC fell from $68,000 to around $49,000 amid recession fears, poor US jobs data, and sluggish growth in top tech stocks.

Similar data is happening now, after Donald Trump’s tax policies were announced, the stocks of the top 7 US technology companies have lost 750 billion USD in value. Concerns about inflation and trade wars continue to overshadow the market. Indicators of economic inflation risks have been pushed up by analysis companies.

Source: https://thanhnien.vn/lieu-bitcoin-co-sup-do-lan-nua-185250313174925518.htm