Bitcoin Price Faces Potential 6% Drop After Breaking Key Support Level: Will Bulls Rebound?
Highlights
- Bitcoin price falls below a 25-day support trendline, signaling potential bearish momentum.
- 365-day MVRV ratio indicates 36% of investors are holding unrealized profits.
- Technical indicators suggest a possible 6% decline to $92,514.
Bitcoin’s price has slipped below a crucial 25-day ascending trendline that previously acted as support. This marks a significant shift in momentum, with both technical and on-chain metrics pointing to a potential crash in the near term.
Bearish Signals Suggest Bitcoin Weakness
BTC has been consolidating within an upward-sloping channel, but its recent inability to sustain above the $100,000 psychological level has introduced bearish sentiment. Falling below this key barrier highlights an increase in selling pressure, which could lead to further declines. 
The 365-day Market Value to Realized Value (MVRV) ratio, currently at 36.59%, suggests that a significant portion of investors are in profit. This increases the likelihood of a correction as more investors may sell to realize gains. Similarly, the Network Realized Profit & Loss (NPL) indicator reveals spikes in profit-taking activities, further hindering Bitcoin’s upward momentum. 
Technical Analysis: BTC Eyes $92,514 Support
Multiple technical indicators support the bearish outlook:
- The Relative Strength Index (RSI) has dropped below the 50 level, signaling a shift from bullish to bearish momentum.
- The Awesome Oscillator (AO) shows receding bullish momentum, with red histograms appearing above the zero line. A dip below this mean level could trigger additional selling pressure.
The first support area at $94,875 may provide temporary relief. However, breaching this level could drive BTC down to $92,514, representing a 6% drop from its current price of $98,065.
A Possible Bullish Comeback?
Despite the bearish indicators, there remains a possibility for recovery. If Bitcoin bounces off the inclined support trendline, it could reignite buying pressure. For a bullish reversal, BTC would need to secure a decisive weekly close above the $100,000 mark, turning it into stable support. This move could pave the way for BTC to reach a new all-time high of $111,800. 
Outlook: Bearish Momentum Dominates Short-Term Prospects
While Bitcoin’s current technical and on-chain metrics lean bearish, the potential for a recovery depends on whether BTC can reclaim key levels. Investors and traders should closely monitor price movements around the $100,000 resistance and the $94,875 support zone to gauge the next direction for the cryptocurrency.
