After successfully breaking through the $91,000 mark, Bitcoin [BTC] is facing a correction that has once again pushed the price of the king coin below $90,000. In fact, the latest data already foreshadows the possibility of a correction. Does this mean that the BTC price will fall further?
Bitcoin bull run pauses
In the past few weeks, Bitcoin has broken through multiple resistance levels. This has made the community full of expectations for BTC to hit $100,000 next.
However, soon after reaching $91,000, a sell signal came in. Ali, a well-known cryptocurrency analyst, recently posted a tweet revealing that Bitcoin’s TD Sequential gave a sell signal.
BTC’s rally did stall after the signal appeared, as its value has dropped by more than 3% in the past 24 hours. At the time of writing, BTC is trading below $90,000 at $87,524.10.
In addition to this, AMBCrypto also reported earlier that the cryptocurrency market is in a phase of “extreme greed”. This is similar to the situation in March when Bitcoin soared to $73,000 and then plummeted again to $67,000.
At press time, the Fear and Greed Index also stood at 80, indicating that greed is also present in the market.
But investors should remain patient. The Bitcoin Rainbow Chart indicates that the price of the King Coin is in the “HODL” position, which means that it may be the right choice for investors to continue holding Bitcoin.
Data from Glassnode shows that despite the recent sharp price increase, Bitcoin’s NVT ratio fell sharply last week. Whenever the indicator drops, it means that the asset is undervalued, suggesting a price increase in the coming days.
Another piece of good news for BTC is that its exchange reserves have fallen over the past 24 hours. This suggests that investors are not panic selling, which could prevent a sharp price drop in the short term.
Checking BTC’s nearest support level
When prices continue to fluctuate, looking at Bitcoin’s daily chart is often a good option for finding immediate areas of support and resistance.
The price of BTC has hit the upper Bollinger Bands, and at the time of writing, it is testing support near $86,000. A successful test of this support could spark another bull rally.
Nonetheless, if Bitcoin fails to achieve this goal and breaks below the support, a drop to the $76,000-80,000 range is likely. If the price plummets further from this range, it could push BTC down closer to the $70,000 mark again.
