The cryptocurrency market is enduring a turbulent period as liquidations reach an astounding $1.47 billion, with Bitcoin alone accounting for a $630 million loss. The Bitcoin price has hit a 24-hour low of $86,314, marking its second consecutive bearish candle and a drop of nearly 10%. This downturn brings Bitcoin close to its 200-day Exponential Moving Average (EMA) line, sparking speculation about a possible further plunge towards the $75,000 mark.
The daily charted trend for BTC has shown a bearish reversal under the local support or resistance trendline. This downward movement has slipped under the 50- and 100-day EMA lines and is now inching towards the 200-day EMA support.
This plunge has resulted in two bearish engulfing candles, bringing Bitcoin back to price levels last seen in November 2024. Increased selling pressure has triggered a bearish crossover between the 50- and 20-day EMA lines. Moreover, the Moving Average Convergence Divergence (MACD) and signal lines have retained their bearish alignment, marked by the emergence of new red histograms.
Adding fuel to the fire, the US Bitcoin spot Exchange-Traded Funds (ETFs) have noted a significant outflow of $516.41 million amidst the sell-off. Leading this trend is Fidelity with $246.96 million in outflows, followed by BlackRock and Grayscale with $158.59 million and $60 million respectively. ARK and 21Shares are yet to share their trading flows for February 24.
With the sell-off reducing Bitcoin to levels around $86,000, the historical in and out of the money indicators reveal that about 12% of all Bitcoin addresses are now holding at a loss. This represents the highest percentage of unrealized losses since October 2024.
Despite the bearish market, there may be a glimmer of hope for Bitcoin. The daily price analysis indicates that the low price rejection in the intraday candle has pushed the market price up to $88,231. This could suggest a potential recovery if the bulls manage to hold their ground near the 200-day EMA line.
However, if Bitcoin closes bearishly under the 200-day EMA line, it runs the risk of retesting the next crucial support level at $75,000. In the event of a bullish turnaround, the reversal could face resistance at the 100-day EMA line at $93,965.
A robust rebound above $90,000 could restore investor confidence and potentially curb the ongoing sell-off. Nevertheless, sustained institutional outflows could put Bitcoin in danger of falling below multi-month support levels, potentially triggering further market panic. As the situation unfolds, investors and stakeholders watch keenly to see how the Bitcoin market responds.
