Expert warning: Bitcoin's decline may not be over

Bitcoin (BTC) has hit a 15-week low at the opening of Wall Street on February 25th, as selling pressure from the US continues to push BTC price lower.

BTC price enters bear market territory Data from TradingView shows that the BTC/USD pair is approaching the $86,000 level. Bitcoin is currently trading at its lowest level since 13/11, struggling to find motivation to recover amidst traders’ concerns about the impact of a mass liquidation. In just the past 24 hours, the total liquidation value in the cryptocurrency market has touched nearly $1.6 billion, dragging market sentiment deep into the ‘extremely fearful’ zone.

After a 20% drop from its all-time high just a month ago, Bitcoin officially entered a bear market from a technical perspective, as recorded by the financial data and trading platform Barchart. “BTC price is currently dropping below the lower bound of the accumulation range, this process is currently taking place,” well-known analyst Rekt Capital summarized. Rekt Capital has provided a weekly chart, highlighting key structures in BTC price movements since the end of the macro bear market in late 2022. In a post on X in early February, Rekt Capital also mentioned several times of such downward deviation, calling it a ‘good buying opportunity’.

Regarding price prospects, analyst TheKingfisher predicts that BTC may drop to lower levels, near the previous peak of $73,800 and rebound in March 3/2024. “Long orders are liquidated (on the left side) densely concentrated in the range of $68,000-$77,000. Short orders are liquidated (on the right side) significantly increased in the range of $103,000-$138,000,” he commented when analyzing the related chart. “There is currently an imbalance leaning towards liquidation at the current price level. Risk: A large Long liquidation cluster below may act as support, but if this level is lost, it could trigger a sharp decline. Target: Short positions may target the $103,000 area.”

Warning about the declining demand for Bitcoin from institutions In terms of macroeconomic factors, QCP Capital believes that inflation in the US is no longer a major concern for Bitcoin. “QCP noted in a Telegram announcement that, considering the overall picture, the stock market, fixed income, and most of the gold have shrugged off data that used to be considered negative factors, while Bitcoin is still maintaining a sideways state”. QCP also emphasizes that the road ahead may not be smooth, even in the context of Bitcoin receiving increasing attention from large organizations. “We are still cautious,” QCP concluded. “Recent BTC demand has mainly come from institutions such as MicroStrategy, through convertible bond issuances. With cryptocurrency-related issuances accounting for about 19% of the total issuance in the past 14 months, the market for this form of financing may be nearing saturation — which could reduce demand from institutions if spot prices continue to move sideways”.