Bitcoin may see a short fix in its $72,000 support as it remains limited to its imminent market recovery.
Bitcoin (BTC) prices exceeded $78,197, a three-month low of over $78,197 on February 28th, and exceeded $109,000, exceeding 28% from the record high that reached January 20th.
Bitcoin could experience a deeper retrace towards a “low $70,000 range as a market repositioning,” according to Iliya Kalchev, temporary analyst at Digital Asset Investment Platform Nexo.
BTC/USD, one-day chart. Source: TradingView/Cointelegraph
However, “We don’t think there’s a chance of a significant drop below $75,000,” the analyst told Cointelegraph, adding:
“There may be temporary backtracks to fill the gap in which the market remains during rapid climbs, but Bitcoin is likely to establish solid support in the $72,000-80,000 range.”
“This support provides a foundation for a more sustainable recovery and reduces the chances of deeper retracement,” he said.
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Other analysts predicted a near $70,000 Bitcoin bottom in early 2025 before the next phase of the rally.
Based on its correlation with the global liquidity index, Bitcoin right side (RHS), which marks the lowest bid price that someone willing to sell, could fall below $70,000 around the end of February after peaking at nearly $110,000 in January.
Source: Raoul Pal
The first warning of the $70,000 revision came from Raoul Pal, founder and CEO of Global Macro Investor in November. They also predicted that Bitcoin would reach a “local top” of over $110,000 in January before the current revision.
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Crypto Investor Sentiment drops to 2022 Low
Analysts hope Bitcoin will find its bottom and begin a recovery in the coming weeks, but the crypto market remains limited by a lack of investor trust.
The Crypto Fear & Greed Index, which measures sentiment across the crypto market, fell to its nearly three-year low, last seen in July 2022.
Source: Alternative.me
The last time investor sentiment fell to a similar level was down by more than 37% per month in June 2022, a month after Bitcoin fell to $17,500.
BTC/USD, 1 month chart. Source: TradingView
The decline in investor sentiment was caused by an array of external and crypto-specific factors, Bitfinex analysts told Cointelegraph, adding:
“Overall, the combination of a sudden decline in Bitcoin prices, regulatory uncertainty, security breaches and a decline in AltCoin ratings has created an extreme fear of the crypto market.”
“It’s not a component of the index, but we’re consistently seeing new highs of long liquidation over the numerous flashes from February 3rd and the current February 27th to February 27th,” the analyst added.
Meanwhile, the broader crypto market is still recovering from the $1.4 billion buy-bit hack that occurred on February 21, marking the biggest hack in crypto history.
With a positive signal from the crypto industry, BYBIT continued to respect the withdrawal of its customers, replacing the $1.4 billion ether stolen by February 24, just three days after the attack.
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