Will Bitcoin collapse again?

Bitcoin (BTC) is trading around $83,000 on March 13th after breaking below $76,600 on March 11th. Following the sharp fluctuations, the price of BTC recovered but failed to surpass the $84,000 mark. This has led market analysts to worry about a potential further crash for Bitcoin.

Demand for Bitcoin remains weak.

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

According to data from market analysis firm CryptoQuant, demand for Bitcoin remains low. This means that potential investors' appetite for the world's most valuable cryptocurrency has weakened.

The chart shows Bitcoin demand is at an alarmingly low level.

IMAGE: SCREENSHOT FROM CRYPTOQUANT

Market observers noted that demand for Bitcoin accelerated from November to December 2024 thanks to the "Trump victory effect." However, by the end of February, all indicators had fallen sharply. Expectations for policies related to the strategic Bitcoin reserve fund and the first White House cryptocurrency summit collapsed, leading to a pessimistic market sentiment.

CryptoQuant predicts that if this trend continues, the price of Bitcoin could fall even further, similar to the crash in July 2024. At that time, Bitcoin dropped 30%, then hit a low of $49,000 on August 5, 2024.

Bitcoin could experience a sharp price drop.

Data from Cointelegraph Markets Pro and TradingView shows that the current Bitcoin price is still 7% higher than its 4-month low. However, CryptoQuant believes this recovery is not enough to guarantee a further price increase. On the contrary, a more significant price correction is likely imminent.

The Bitcoin bull/bearish cycle indicator is currently at the "deepest point" of this cycle. A value above 0 indicates a bull market, while a value below 0 indicates a bear market. Currently, the indicator is at -0.067 points. This is the lowest level since May 2023.

Bitcoin symbol coin

Meanwhile, the MVRV Z-score, used to assess Bitcoin's valuation, indicates that the uptrend has lost momentum. Historically, valuation metrics at this level often signal a sharp correction or the beginning of a price drop.

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

Short-term investors are fleeing.

According to blockchain analytics firm Glassnode, those who bought Bitcoin in January when it peaked at $109,000 are now looking to sell. Data released on March 11th shows that this sell-off by those who bought at the peak is what caused Bitcoin's price to fall.

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

Glassnode explains that a similar Bitcoin sell-off pattern emerged in August 2024 when BTC dropped from $68,000 to around $49,000 amid recession concerns, poor US employment data, and sluggish growth in leading tech stocks.

Similar events are unfolding now, following the announcement of Donald Trump's tax policies, with the stocks of seven leading US technology companies plummeting $750 billion in value. Concerns about inflation and trade wars continue to overshadow the market. Economic inflation risk indicators are being pushed higher by analytical firms.

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