A Deeper Correction for Bitcoin ?
According to Glassnode’s extreme deviation bands, the price of Bitcoin fell below the +0.5σ band on June 21. Historically, this signal often indicates a broader correction.
Furthermore, the price drop resulted in a decrease in the Stablecoin Supply Ratio (SSR), indicating increased buying power in the market. However, this does not guarantee an immediate rebound.
Despite the accumulation of buying power, the downside risk remains high. The price drop of BTC compared to its all-time high was only -8.75% on June 21, while historical retracements ranged from 20% to over 50% before a rebound.
A clear break above the all-time high could prove challenging. The current market volatility may persist, with a possible further drop below $100,000 before the next major move.
What Levels to Watch ?
The average cost of purchase for short-term holders was nearly touched yesterday during the drop of BTC to $98,321. This level could be tested again in the coming days, reaching $98,174.
According to Axel, over 14K BTC were sold at a loss in the last 24 hours, compared to 3K in profits. “The market is now on high alert due to a possible response from Tehran, including threats against US personnel in the region or a potential closure of the Strait of Hormuz,” he notes.
Caution is advised. A drop below $95,000 for Bitcoin could extend the bearish period. The demand zone between $95,550 and $97,880 is the ideal area for Bitcoin to bounce in case of further decline.
$95,500 corresponds to the lower end of the Ichimoku cloud on a daily basis, as well as the 200 and 100-day moving averages. Meanwhile, $97,980 is the upper limit of this strong demand zone. On the flip side, bulls will need to reclaim $102,400 and then $105,000 to reignite the momentum.
