Bitcoin, the giant of the cryptocurrency world with a market capitalization hovering around $1.9 trillion, has suffered a significant downturn, falling below the psychological threshold of $100,000. The flash sell-off, which occurred in just three days, has left many investors and analysts wondering whether this signals the end of the current bull market or signals a healthy correction in the ongoing uptrend.

Temporary Pullback Or Trend Reversal?

The price action this week is particularly noteworthy, as Bitcoin broke below the $100,000 support level, which had held firm for eight consecutive days. Market analysts point to several factors contributing to this decline. A significant impact is the strategy of market makers, including pushing prices high to encourage traders to open long positions around $98,000, thus increasing liquidity.

After this liquidity dried up, market makers used the speech of Federal Reserve Chairman Jerome Powell as a catalyst to push prices down, filling inefficient price levels at $93,744 (50%) and $90,513 (100%).

Analysts explain, "The decline of Bitcoin was necessary as there were inefficiencies below the price that needed to be filled, namely $93,744 for 50% and $90,513 for 100%. The inefficiency rule states that traders must fill 50% or 100% of the inefficiency points."

They added that market makers "deliberately pushed prices high to encourage traders to open long positions, thereby increasing liquidity at $98,000. Exhausted market makers decided to wipe out liquidity at $98,800 and used Powell's speech as a catalyst to drive the downtrend."

Experts currently predict the price will bounce back to $101,000 before a pullback or continuation of the trend, as the range of $93,788 - $92,200 is currently serving as strong support. This area has witnessed significant buying orders, aligning with the recent 50% inefficiency level. A bounce from this level seems inevitable.

BlackRock And Organizational Moves Signal Confidence In Bitcoin

In the midst of volatility, BlackRock, one of the world's leading asset management companies, has become the focal point due to its significant investment in Bitcoin. According to information from Arkham Intelligence, BlackRock not only purchased Bitcoin while other ETFs were selling but also accumulated a substantial amount, currently holding 122.6k BTC. This makes BlackRock the 11th largest holder of Bitcoin, controlling about 0.6% of the circulating supply.

Their strong accumulation, including a recent $1.5 billion purchase, sharply contrasts with the net selling of $785 million BTC by the broader market this week. BlackRock's actions have sparked discussions on platforms like X, with many welcoming or humorously noting their transition from traditional assets to digital currency.

Additionally, BlackRock's involvement in the cryptocurrency market is highlighted as their BUIDL Fund received $100 million, signaling a strategic pivot towards digital assets. Such a major force in the financial sector may interpret this move as a vote of confidence in the long-term viability of cryptocurrencies, potentially impacting market sentiment and momentum.

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