Bitcoin has faced its first major correction since early November, falling 13% from its all-time high of $108,364. This sudden withdrawal has sent shock waves throughout the crypto market, changing sentiment from pure excitement to uncertainty and even fear. The sell-off has been particularly brutal for altcoins, many of which are bleeding hard as Bitcoin struggles to move back.
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Key metrics from CryptoQuant highlight the seriousness of the situation, with a total loss of $28.9 million – an alarming 3.2 times higher than the weekly average. This spike in realized losses indicates that some investors are exiting positions as the market rebalances after weeks of aggressive upward movement.
The big question now is whether this is just a healthy correction in an otherwise bullish trend or the start of a larger decline. Traders are watching closely Bitcoin's ability to hold critical support levels and the behavior of altcoins, which often increase Bitcoin price movements.
For now, the market remains at a crossroads, with the coming days likely to reveal whether Bitcoin can recover and restart – or if this correction signals a longer weak period.
Bitcoin versus selling pressure
Bitcoin is under heavy selling pressure after two days of aggressive bearish activity, marking a pivotal moment for the market. The sudden shift in sentiment has caused many analysts and investors to turn cautious, with some turning bearish as Bitcoin's recent movement begins to lose momentum. This correction has left the market questioning whether the current price movement is a natural stop or a precursor to deeper losses.
Senior Examiner Axel Adler recently shared insights on Xsupported by strong on-chain data, indicating realized losses have increased to $28.9 million. This figure is 3.2 times higher than the weekly average, reflecting higher sales activity. Adler's analysis indicates that although the sell-off may be alarming, it is consistent with a healthy market correction, especially after Bitcoin's dramatic rally to $108,300.
Adler notes that the current downturn should not trigger panic but instead be a moment of patience for long-term holders. He stressed that now is the time to HODL unless additional bearish signals emerge to suggest a further decline. Such corrections often provide the market with the necessary fuel for the next move up, as weaker hands exit and strong hands position themselves strategically.
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Price action remains critical, with investors watching closely to determine whether this correction cements a strong foundation for future growth or lower indicators.
BTC Bullish Holding Structure (For Now)
Bitcoin is trading at $94,400 after three consecutive days of aggressive selling pressure. Despite the obvious bearish sentiment affecting the market, BTC has held the base above the key support level of $92,000. This support is crucial because it clearly explains the continued increase. Holding above this level suggests resistance and sets the stage for a possible strong bounce if buyers regain control in the coming sessions.
Although recent price action suggests uncertainty, the downturn has not been as severe as market sentiment suggests. Negative sentiment has forced many traders to take a cautious stance, but BTC's ability to remain above $92,000 indicates fundamental strength in the market structure.
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However, sentiment remains a critical market driver. It will be essential for Bitcoin to restore confidence to regain higher levels and resume its supportive trend. If sentiment does not improve and prices continue to decline, there is a risk of a deeper correction. Losing the $92,000 support could pave the way for a retest of lower rates, potentially causing additional volatility.
Featured image from Dall-E, chart from TradingView
