BTC Price Fell 22% From an All-Time High
Bitcoin, which holds the lion's share of market capitalization, has lost 22% of its price from an all-time high of $41,900 set in December.
The coin is currently trading at $32,544. The downward trend followed active sales in the morning. Cryptocurrency capitalization is about 605 billion, which is 150 billion less than the December figure.
In the TradingView image below, you can see that BTC is trading below the 55-day moving average and is currently in a downtrend. The indicator takes into account 55 fresh prices at which the cryptocurrency was traded every 4 hours, and this helps to get a detailed picture for analysis and assess the market trend.
Despite the fall in value, analysts point to the need to buy bitcoin instead of selling it. Actually, many do just that. Over the past month, it became clear that 270 thousand Bitcoins were withdrawn from the exchange for the purpose of holding to addresses or crypto wallets previously seen in this.
#Bitcoin is seeing the largest depletion of liquidity since years.— glassnode (@glassnode) January 20, 2021
Not only are funds being withdrawn from exchanges, but coins are continuously moving to strong hands.
In the past 30 days, around 270,000 BTC moved to entities considered HODLers.
Chart: https://t.co/0yXCxzEufh pic.twitter.com/00NnrFpHRq
This led to the largest liquidity depletion in years. Not only cryptocurrency is being withdrawn from exchanges. It also falls into strong hands. But small investors do not risk buying Bitcoins at current prices due to the high volatility. This will strengthen the bearish trend in the long term.
According to some analysts, such as Scott Minerd of Guggenheim Partners, Bitcoin has exceeded its "technical upside" potential of $35,000. This means that a correction is possible, and in 2021, BTC is unlikely to rise above $41,000.
Bitcoin's parabolic rise is unsustainable in the near term. Vulnerable to a setback. The target technical upside of $35,000 has been exceeded. Time to take some money off the table.— Scott Minerd (@ScottMinerd) January 11, 2021
In the long term, his outlook is bullish. Minerd believes BTC will be trading at $400,000 per coin. Let's see how true this statement is.