Bitcoin Crisis! Drops Below $95,000, is $88,000 the New Support?

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Recently, Bitcoin has faced a significant correction due to macroeconomic concerns and sell-offs in the spot market, causing the global crypto market to plummet by 8.4%. The price of Bitcoin has fallen below $96,000, testing the critical support level of $95,000. Analysts warn that if this support cannot be held, Bitcoin may retest $88,000.

Critical Support Level at Risk

Analyst Skew points out that if Bitcoin drops to $95,000, it could trigger further declines down to $88,000. Liquidity data shows strong buying interest around $88,000, which could attract buyers if it falls to that level.

Market Liquidity Decreases, Selling Pressure Increases

Binance's trading volume has significantly declined, and insufficient spot liquidity has put Bitcoin under greater downward pressure. Data also shows that Bitcoin's inflows have noticeably weakened, with inflow on January 7 dropping sharply, indicating weak institutional demand.

On-chain Data Leans Bullish

Despite the bearish sentiment in the market, on-chain data shows that investors are transferring Bitcoin from exchanges to personal wallets, possibly indicating their intention to hold long-term, thus alleviating market selling pressure. Additionally, Bitcoin's capital flow remains positive, indicating that there is still ongoing buying demand in the market.

Conclusion: Bitcoin's Short-term Outlook is Complex

Bitcoin is currently trading within the range of $91,000 to $101,165, and may experience short-term fluctuations. Despite bearish predictions, on-chain data indicates that there is still some bullish momentum in the market, and investors should cautiously monitor market trends.

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