Bitcoin Price – Is Bitcoin’s Bull Market Over? Key Signals Point to Bearish Trend

Bitcoin Price – Bitcoin’s Liquidity Crisis: Can BTC Recover or Is the Bull Run Over?

Bitcoin Price – The Bitcoin (BTC) bull market appears to be over, according to Ki Young Ju, the founder of the crypto research firm CryptoQuant. In a recent post on X (formerly Twitter), Ju warned that Bitcoin’s bull run is losing momentum and expects a prolonged period of bearish or sideways price action. He pointed to declining liquidity as a key reason for the cooling of the market, indicating that without fresh capital inflows, BTC is unlikely to see significant upward movement in the near future.

Declining Liquidity Signals Bearish Market Trends

Ju’s analysis highlights the crucial role of liquidity in sustaining a bull market. He stressed that new liquidity is needed to fuel price growth, but the market’s liquidity has been steadily declining. “The on-chain realized cap has stalled, signaling no fresh capital inflows,” Ju stated, pointing to BlackRock’s IBIT as an example. According to Ju, IBIT experienced three consecutive weeks of outflows, indicating a lack of new investment capital entering the Bitcoin market.

Even with record trading volumes near the $100,000 mark, Bitcoin’s price has shown little movement, which Ju believes is a clear sign of a weakening market. “Without new liquidity to offset heavy selling, this is a bearish signal,” Ju explained. These remarks are consistent with broader concerns that a lack of capital could lead to further downward pressure on Bitcoin’s price.

Bitcoin’s MVRV Ratio Z-Score Points to Potential Downward Momentum

A recent report from CryptoQuant further supports the bearish outlook for Bitcoin. The report focused on the MVRV (Market Value to Realized Value) Ratio Z-score, a key valuation metric used to identify overbought or oversold conditions in Bitcoin’s price. The MVRV Z-score compares Bitcoin’s market value (MV) to its realized value (RV), which is the value of Bitcoin based on the price at which it was last moved.

CryptoQuant noted that the MVRV Z-score has dropped below its 365-day moving average, which historically signals a weakening of Bitcoin’s price momentum. This has typically aligned with deeper price corrections or the onset of bear markets in the past. As a result, many analysts are concerned that Bitcoin may face significant downward pressure over the coming months.

Support Levels and Risk of Price Correction

According to CryptoQuant analysts, the $75K-$78K support level is critical for Bitcoin. This range is seen as an important zone where Bitcoin’s price could stabilize if it faces further downward pressure. However, weakening demand for BTC, driven by slowing whale accumulation and net selling by U.S.-based spot exchange-traded funds (ETFs), is adding additional downward pressure.

The risk of a deeper price correction is increasing as these factors continue to develop. The ongoing weakness in the U.S. equity market, coupled with global economic uncertainties, is expected to exacerbate bearish sentiment in the cryptocurrency market. Joel Kruger from LMAX Group and David Duong from Coinbase Institutional have both expressed concerns that the continued volatility in traditional financial markets could spill over into crypto, further dampening investor sentiment.

Polymarket Predictions Suggest BTC Could Struggle to Stay Above $80K

Looking at market sentiment, Polymarket bettors are giving Bitcoin a 51% chance of ending the week between the $81K-$87K range. However, there’s a 31% chance that Bitcoin will hit the $75K mark by the end of the month. This suggests that while there is still some optimism in the market, the risk of a price decline remains high.

Bitcoin Down 15% in the Last Month

According to data from CoinDesk Indices, Bitcoin has fallen 15% over the past month. This decline has erased any gains that Bitcoin made following the U.S. election, further supporting the idea that Bitcoin’s upward momentum has stalled. As the market faces challenges such as reduced liquidity, global economic uncertainties, and a lack of new investment, Bitcoin’s future in the short term remains uncertain.

Conclusion: Bearish Trends to Persist for Bitcoin in the Coming Months

In conclusion, the Bitcoin bull market appears to have come to an end, with CryptoQuant’s Ki Young Ju predicting a period of sideways or bearish price action over the next 6-12 months. The lack of new liquidity, combined with the weakening MVRV Z-score and critical support levels under threat, points to a challenging road ahead for Bitcoin. Traders and investors will need to watch key price levels closely and be prepared for further volatility in the coming months.

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.