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Yesterday, Bitcoin faced a sharp pullback, hitting an all-time high of 108,300 after the Federal Reserve announced a 25 basis point rate cut along with a policy revision that suggested it would reduce the rate cuts in 2025. It fell 8% from the dollar. Despite the drop, Bitcoin managed to hold above $98,000. Important liquidity levels that are closely monitored by analysts.
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This recent price movement raises a very important question: Is this the beginning of a more significant correction, or just a shakeout to fuel Bitcoin's next upswing? CryptoQuant analyst Axel Adler provided important insight, noting that there was no obvious panic selling in the market, indicating that investor confidence remains intact for now.
Bitcoin’s resilience at current levels suggests the market is recalibrating following the Fed’s latest moves. As traders and investors digest these developments, all eyes are on whether Bitcoin can regain momentum and push back toward previous highs, or whether a deeper retracement is on the horizon. . The next few days will be crucial in determining the next direction for Bitcoin, as market sentiment remains delicate.
Bitcoin remains strong
Despite recent declines and notable shifts in market sentiment, Bitcoin remains resilient above key liquidity levels and maintains a long-term bullish structure. While the price decline caused by the broader market reaction to the Fed's policy announcement is causing concern, Bitcoin's ability to maintain significant support highlights its fundamental strength.
Axel Adler, a top analyst at CryptoQuant, recently shared data on X and shed light on the current dynamics of the market. Adler said he hasn't seen any noticeable panic selling even after Bitcoin's sharp decline.
Bitcoin STH Exchange Profit vs. Loss | Source: Axel Adler of X
He highlighted a chart that tracks the gains and losses of short-term Bitcoin holders on exchanges, revealing that the indicator is currently at higher levels than seen during the sell-off event in early December. This suggests that the recent decline in stocks may not be due to fear, but rather strategic realignment.
This shakeout could create liquidity and provide the momentum needed for Bitcoin's ongoing rally. But he also cautioned that this could mark the beginning of a broader adjustment that could take time to fully develop.
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The next few weeks will be pivotal for Bitcoin. As the market stabilizes, traders and investors will be watching to see if Bitcoin can regain higher levels or if further consolidation will occur.
Price action: technical level to maintain
Bitcoin is currently trading at $101,800 after a successful test of domestic demand at $98,695 earlier today. The price structure remains intact, with Bitcoin forming a clear pattern of highs and lows, indicating continued bullish momentum. Despite the recent volatility, market sentiment remains optimistic as BTC remains above key support levels.
BTC maintains bullish structure | Source: BTCUSDT chart on TradingView
A decisive push above $103,600 is essential for Bitcoin to maintain its upward trajectory. This level served as an important pivot last week, marking an important zone for both buyers and sellers. A breakout of this resistance level would likely signal new momentum and set the stage for further gains as Bitcoin heads toward new highs.
However, failure to break above $103,600 could lead to a change in sentiment. If BTC also loses the $100,000 psychological level, we are likely to see the start of a broader correction. In such a scenario, the price could head towards a lower support zone as the market realigns.
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The next few days will be crucial in determining Bitcoin's near-term direction. Traders are closely monitoring the $103,600 resistance level and $100,000 support level. These thresholds will determine whether BTC continues to rise or enters a correction phase.
Featured image from Dall-E, chart from TradingView
