Bitcoin's dramatic rise from below $70,000 to surpassing $108,000 shortly after Donald Trump clinched the US presidential victory certainly left some investors watching from the sidelines. Yet, Bitcoin's well-known volatility often triggers significant corrections, presenting fresh opportunities for those who initially missed out.
Recently, Bitcoin's double-digit decline has sparked renewed interest among investors eager to "buy the dip," as noted by Santiment. Historically, such behavior has set the stage for Bitcoin to soar once more.
According to the analytics platform, a similar buying frenzy was last recorded in early August when Bitcoin's price dipped below $50,000, only for the asset to leap upwards by over 25% to surpass $62,000 within a few days. If past performance is any indicator, Bitcoin, despite its larger market capitalization, might rebound from its recent downturn, potentially reaching new heights above $120,000.
Today's market saw Bitcoin fall to as low as $95,500. Discussions around buying this dip have now peaked to levels unseen in over eight months. The enthusiasm matches the crowd's reaction during the significant downturn on August 4th, hinting at potential market movements ahead.
However, while historical patterns suggest Bitcoin's correction might soon end, other on-chain and technical indicators paint a differing picture. For instance, a critical demand zone, as mentioned by IntoTheBlock, had formed above $97,500, where over 1.4 million Bitcoin were purchased. This accumulation shifted this price level into a vital support zone, which has since been breached.
Breaking such key support lines typically forces recent investors—now facing paper losses—to unload their holdings, thereby increasing sell-offs and intensifying downward pressure on Bitcoin's price.
Interestingly, a new demand area has emerged just below $100,000, characterized by more than 1.45 million BTC gathered at an average price of $97,500. This establishes a crucial support threshold, potentially impacting Bitcoin's near-term trajectory.