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Bitcoin Drops to $90,000, But Signs of Quick Recovery Emerge

The price of Bitcoin plummeted, falling 6.4% in a single day to a low of $90,000. Investors rushed to transfer their shares onto exchanges as a result of this decrease, which led to panic selling. Over the last two days, exchanges received more than 80,000 Bitcoin, or roughly $7.5 billion; this is a common practice prior to significant sell-offs.

Bitcoin price drop and recovery signals with chart analysis
Source: https://bitcoin.com.au/what-is-bitcoin/

Despite all of this chaos, one important sign indicated that it might not last long. The CDD, a metric used to track long-term holder activity, remained low, indicating that seasoned investors are holding onto their BTC in anticipation of a rebound. Historically, when long-term holders stay inactive during a dip, prices tend to recover.

Bitcoin’s price chart is forming a rounding top pattern, which could shift into an inverse cup and handle—a sign that the bearish momentum may weaken soon. If BTC holds its support level at $93,625, a bounce back above $95,668 could push prices toward $100,000. A successful breach of this level could even drive Bitcoin up to $105,000.

However, if the bearish trend continues, BTC could drop further to $92,005. The key to recovery lies in flipping $100,000 from resistance into support; if this happens, it could mean the current downturn will be only temporary and not usher in a drawn-out bear phase.

February 3, 2025 at 9:09 pm

Updated February 3, 2025 at 9:09 pm

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