The much-anticipated bullish upswing following the launch of the Spot Bitcoin ETF has faltered, casting a bearish shadow across the cryptocurrency markets. Investors are grappling with minor upswings in Bitcoin prices, which, unfortunately, are triggering significant pullbacks.
As a result, bullish traders find themselves ensnared at various price levels, including $48,000, $47,000, $43,400, and $41,600, with the potential of remaining stuck at $40,000 for an extended period.
Market sentiment had initially been optimistic, with expectations of the Spot Bitcoin ETF approval leading to a surge in Bitcoin prices, potentially reaching close to $50,000. Previous highs for the year had soared above $48,500, contributing to the bullish outlook among investors.
Bitcoin Braces for Drop: $32,600 Warning
Crypto analyst CryptoCon, sharing insights via a post on X, emphasized the continued significance of the Magic Bands in accurately predicting Bitcoin price movements. Notably, the mid-top, predicted to occur at Blue Level 2 at $49,200, has materialized as anticipated. Looking ahead, attention is now focused on the next potential correction point – the yellow Level 2 at $32,600.
Analyzing historical trends, CryptoCon notes that each mid-top has reached a primary band before correcting to the next lower one. While there are data-driven suggestions of even lower prices, around $28,000, the analyst deems $32,600 as a more reasonable expectation.
As of today, the Bitcoin price stands at $40,123, experiencing a marginal 0.07% increase in the last 24 hours. The 24-hour trading volume is reported at $31.54 billion, with a market cap of $786.77 billion.
Bitcoin Wallets Sell Off in Disappointment
Santiment’s data adds a layer of concern to the current market dynamics. The total number of Bitcoin wallets has been declining at the fastest rate since early October, just before the onset of the major crypto bull cycle.
Over the past four days alone, more than 487,000 wallets holding 1 BTC or less have been liquidated. Historically, such a trend has signaled capitulation, often followed by a market price bounce as smaller traders regain optimism in crypto as an investment vehicle.
The disappointment stemming from the market’s performance since the approval of 11 ETFs over the past two weeks is identified as a primary factor behind the recent wave of wallet liquidations. Investors and analysts alike are closely monitoring the situation for potential developments as the cryptocurrency market navigates through this challenging phase.
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