Bitcoin’s price correction may not be over, warn on-chain data analysts



Analysts believe that a larger Bitcoin (BTC) price pullback or period of consolidation could occur. The two factors that could trigger further disadvantage include increased whale activity and short-term resistance.

Bitcoin Whale Watching

As Cointelegraph reported, Bitcoin crashed after going over $ 19,400 on major exchanges. It fell below $ 16,400 before recovering slightly. But analysts are predicting another possible drop, especially if BTC doesn’t rebound strongly in the near term.

Two key trends caused Bitcoin’s recent correction. First, the whales started selling BTC at around $ 19,000, which caused volatility to spike to the bottom. Second, this relatively small price drop triggered a wave of cascading liquidations in an over-leveraged futures market.

Bitcoin stands for all inbound exchanges. Source: CryptoQuant

Ki Young Ju, CEO of CryptoQuant, said further fixes could come in the near term. The All Exchanges Inflow Mean indicator, for example, is still hovering at a high level, suggesting that there is still a lot of selling pressure in the market. he said:

“More $ BTC corrections could come. The average rate of all exchanges (MA 144 blocks) always remains high. In my opinion we will face some fixes / sideways this week and it will break $ 20k by December of this year. I’ll stack some sats a few days later.

The timing of the whale sale is remarkable because it comes after BTC rejected a crucial area of ​​resistance. A pseudonymous trader known as “CryptoKea” has discussed the resistance level under the Mayer multiple price bands since early November.

If the story rhymes, the trader has said a larger correction is likely. Such a trend would still be in line with previous bull cycles when BTC fell 30% to 40% before continuing its rally. The merchant said:

“The top of the bullish channel did a great job acting as short-term resistance, just as it has done at this point in previous bull markets. What happened historically thereafter? History never repeats itself, but often rhymes. These are the historical retrace multiples of the 200DMA where the price found support after being rejected from the top of the bullish channel at around this point of the bull. The current 200DMA is $ 11.2,000, an increase of about $ 40 / day. “

In the near term, key support for Bitcoin stands at $ 16,000. Below that, the next major support areas to watch out for are $ 14,000 and $ 13,500.

Golden Ratio Multiplier identifies key support levels

Philip Swift, the creator of Lookintobitcoin.com, said that the Golden Ratio Multiplier indicator shows a rejection of the 350-DMA resistance.

The multiplier of the golden ratio. Source: Philip Swift

The Golden Ratio Multiplier identifies $ 16,000 and $ 13,000 as crucial support levels, similar to Mayer’s multiple. Fast said:

“Boom! Price firmly rejected by the 350dma x 2 yesterday when CT seemed certain we were going to cross it. This indicator is very present in this cycle.”

Based on both indicators, if Bitcoin bounces and consolidates above $ 16,000, a rally of relief to the next areas of resistance is possible. Otherwise, BTC risks testing the support range of $ 13,000 to $ 14,000.