Bitcoin Price Faces Increased Volatility After Dropping Below $75,000

Bitcoin Price Analysis: Could $70,000 to $80,000 Range Spark a Market Shift?

Bitcoin Price – Bitcoin (BTC) is facing increased price volatility following a significant dip below the $75,000 mark twice in the past week. This downward movement has extended the correction from its all-time high of $109,000, which was reached on January 20. The recent decline has brought Bitcoin into what Glassnode identifies as an “air pocket” between the $70,000 and $80,000 range, created after the cryptocurrency’s rapid rise following President Donald Trump’s election victory in November.

Bitcoin’s Lack of Consolidation Could Lead to Further Volatility

Historically, Bitcoin has struggled to maintain upward momentum without consolidating at key price levels. The cryptocurrency surged from around $70,000 to over $100,000 following the November election, but did not revisit its starting point, which implies low supply in this range. As a result, the likelihood of rapid price movements increases, and Bitcoin may need to revisit these levels to test them once more.

Unspent Transaction Outputs (UTXO) Suggests Imminent Price Action

To better understand BTC’s potential movement, analysts often examine its Unspent Transaction Output (UTXO) data. UTXOs represent the amount of BTC that has been received but remains unspent, indicating coins still available for transactions. The UTXO Realized Price Distribution (URPD) is an important tool that shows the prices at which Bitcoin was last moved.

Currently, less than 2% of BTC‘s total supply sits within the $70,000 to $80,000 range. This lack of supply in the “air pocket” could contribute to the price remaining volatile. Moreover, around 25% of BTC‘s supply is held at a loss, primarily by short-term holders who acquired their coins within the last 155 days, further complicating the market’s short-term outlook.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.