- Bitcoin’s price correction mirrors past dips, signaling a potential March rebound.
- Short-term holders are taking losses, a trend that often precedes market recovery.
- Equity market weakness adds pressure, with Bitcoin testing key support at $90,000.
The cryptocurrency market is expected to see a rebound soon, driven by investor behavior and market trends. According to CryptoQuant data, when short-term investors take losses and move Bitcoin elsewhere during an upward cycle, a price recovery often follows. The recent market correction has triggered panic selling, mirroring corrections seen in May and July 2024.
With fear already priced in, a potential rebound could occur in early March. However, risks remain high as the market progresses through the latter phase of its upward cycle, necessitating caution in aggressive investments.
Market Trends and Short-Term Indicators
The Spent Output Profit Ratio (SOPR), a key indicator of investor sentiment, has dropped to levels seen during previous corrections. This suggests that short-term holders are realizing losses, which historically precedes market rebounds.
Additionally, selling pressure has intensified as investors react to broader financial market conditions. Bitcoin’s price has fallen below the critical $90,000 support level, impacted by weakness in equities. Analysts suggest that if Bitcoin breaks further below this range, it could decline toward $80,000 before finding strong buying interest.
Equity Market Influence on Crypto
The recent downturn in traditional markets has also contributed to Bitcoin’s price movement. The S&P 500 recorded a four-day losing streak as economic growth concerns and global trade uncertainties weighed on investor sentiment.
Consequently, profit-taking and short-term selling have increased in the crypto market. Despite Bitcoin’s initial bullish momentum at the beginning of the year, optimism has faded as traders search for a new catalyst.
Earlier expectations of crypto-friendly policies under the Trump administration fueled market enthusiasm. However, after the executive order on digital assets was released in January, investors found little to drive further gains.
Although the order was well-received, its impact was milder than anticipated. With no immediate policy changes expected, the market remains in a consolidation phase.
Potential Support and Future Outlook
Bitcoin’s current price of $89,133.55 marks a critical point for traders watching the next support level. If the price fails to hold above $90,000, further declines to the $70,000–$75,000 range remain possible.
