Bitcoin’s (BTC) market correction led by a decline in its value persisted for the third consecutive day, with the cryptocurrency slipping an additional 3.5% in the last 24 hours. BTC is now hovering just under $94,000, a week after briefly reaching near the $100,000 mark for the first time.
Weekly gains for BTC have dwindled from over 10% to just 3% as traders have cashed out, anticipating a pullback. Other major cryptocurrencies have also experienced a decline, with Solana (SOL), Binance Coin (BNB), Cardano (ADA), and Dogecoin (DOGE) each falling by as much as 7% in the last day.
The CoinDesk 20 (CD20), a key index tracking major cryptocurrencies by market cap, excluding stablecoins, has also dropped nearly 3%.
Despite the ongoing correction, the $100,000 price target for BTC remains intact. Analysts expect a pullback of up to 10% from the recent peak, possibly bringing prices down to $92,000, which they consider a “normal market adjustment.”
“This correction occurred due to leverage overheating, as open interest and estimated leverage ratio reached annual highs,” said MAC_D, an independent analyst at CryptoQuant, in a Tuesday report. “Therefore, a 10-20% correction can be seen as a natural phenomenon.”
“From an on-chain perspective, metrics such as MVRV, NUPL, and Puell Multiple still indicate Bitcoin is in a bull market with further upward potential. The key is identifying accumulation phases during these corrections, with the ‘Short-Term SOPR’ being particularly useful,” MAC_D explained.
The Short-Term SOPR (Spent Output Profit Ratio) measures whether Bitcoin holders, who have owned the asset for less than 155 days, are making a profit or loss when selling. A SOPR value above 1 suggests that sellers are making a profit, whereas a value below 1 indicates they are selling at a loss. Last week, the SOPR reached 1.096, signaling that short-term holders were profiting and contributing to the current price decline.
Historically, Bitcoin has rebounded when short-term holders sell at a loss, leading some to view this as a potential buying opportunity, with hopes that BTC could eventually surpass the $100,000 mark in the coming weeks.
“The massive inflow of stablecoin capital into Binance suggests we are likely in the midst of the bull market, rather than at its end,” commented Ruslan Lienkha, chief market strategist at YouHodler. “Bitcoin is currently undergoing a correction, likely driven by profit-taking, and could consolidate before pushing toward the key $100,000 level.”
Market experts expect the path ahead to be volatile.
“The markets will likely remain choppy in the near future, with BTC technical indicators showing overbought conditions,” said Augustine Fan, head of insights at SOFA. “There could be further upward pressure on BTC, possibly reaching $120,000 to $130,000 if it breaks through the $100,000 resistance, though the ride may not be smooth given the overall overbought asset markets.”