Key Points
- Bitcoin experienced a 5% drop, but the reason is not overheating, pointing to potential market manipulation.
- The market’s high-risk sentiment, along with the declining Funding Rates, creates a psychological barrier for investors.
Bitcoin recently witnessed a 5% dip, but this time, overheating isn’t the reason behind the drop. This sudden downturn seems more like a calculated move rather than a market correction, leading to speculations of potential market manipulation.
High-Risk Sentiment in the Market
Recent data reveals a strong U.S. economy with robust PMI numbers and high job openings. However, volatile assets experienced a sharp crash, marking the second such incident in less than a month. Despite this, a 5% dip in Bitcoin, even with the dollar index hitting a two-year high, shows strength in the cryptocurrency.
Bitcoin’s resilience is evident in its track record of bouncing back, especially when institutional investors step in. However, the high-risk sentiment in the market, with over $114 million in long positions wiped out, is creating a psychological barrier for retail investors and day traders.
Anticipating the Next Bitcoin Bottom
When Bitcoin previously dropped to $91K, it made a strong comeback with net outflows hitting $25K. However, the net flow now is just $5K, suggesting that the anticipated “buy-the-dip” moment hasn’t fully kicked in yet. While an immediate sharp reversal isn’t expected, a deeper pullback to $89K — $91K could be the sweet spot to watch for.
Please note that despite the recent crash, expecting an instant rebound might be overly optimistic. Instead, investors’ patience may be tested in the coming days.
