Bitcoin ($BTC) takes a deeper dive. How far will it go?

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As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed numerous bull and bear cycles, and the current situation with Bitcoin ($BTC) is no exception. The recent dip to $92,350 has certainly raised concerns among investors about whether we are seeing the end of the bull market or just a standard reversal before heading back up to take out the $100,000 price level.

The dip in the Bitcoin ($BTC) price has become more pronounced, reaching as low as $92,350. At present, it’s holding slightly above that point. Could we see further drops in the Bitcoin price? Is the bull market coming to an end? Or, is this a typical reversal before resuming its climb and surpassing the $100,000 mark again?

MicroStrategy buys big

MicroStrategy has purchased approximately 55,500 Bitcoins for around $5.4 billion, with each Bitcoin costing roughly $97,862. This acquisition has resulted in a quarter-to-date (QTD) Bitcoin Yield of 35.2% and a year-to-date (YTD) yield of 59.3%. As of November 24, 2024, we hold about 386,700 Bitcoins that were acquired for approximately $21.9 billion, with each Bitcoin costing around $56,761. $MSTR

— Michael Saylor⚡️ (@saylor) November 25, 2024

As the ongoing battle between Bitcoin bulls and bears unfolds, I can’t help but be thrilled by MicroStrategy’s recent acquisition of 55,500 Bitcoins, a move that marks the largest purchase yet by this company. The announcement was made by Michael Saylor, who proudly declared that this purchase amounts to approximately $5.4 billion in Bitcoin. To add to the excitement, he also shared that MicroStrategy has managed an impressive 59.3% Year-to-Date yield from its Bitcoin investments. However, it’s important to note that MicroStrategy’s stock ($MSTR) is currently trading at $403, a decrease from its price of $540 just a week ago.

Ethereum ETFs get inflow day as Bitcoin ETFs record outflows

There’s been a significant departure of Bitcoin ($BTC) from the market, which has led to a minor adjustment in U.S. Spot Bitcoin Exchange-Traded Funds (ETFs). A pause in five consecutive days of inflows was broken on Monday with an outflow of about 4,440 BTC. This occurred simultaneously as institutional investors invested approximately $2.83 million in the U.S. Spot Ethereum ETF. In simpler terms, a large amount of Bitcoin is being sold, affecting Bitcoin ETFs, while at the same time, institutional investors are buying Ethereum ETFs in the U.S.

$BTC price rolls over. Will it go further down?

On the 8-hour Bitcoin (BTC) price chart, there’s a wealth of insights. It illustrates that BTC could not break out from the top of the bullish pennant, instead reversed, dropped beneath the bottom of the pennant, and ultimately dipped below the rising trendline.

It appears that the price was moving within an upward trendline (ascending channel), but recently broke through this pattern, which is common with such structures. The current position suggests a drop following the bull flag channel’s predicted move, but we haven’t yet seen a fall to the projected decrease from the larger ascending channel. If this development unfolds, it would lower the price to around $90,000.

Instead, it appears that the price has struck the 0.618 Fibonacci level, found at approximately $92,890. The lowest Fibonacci level in this movement is the 0.786, which lies around $91,000.

As a crypto investor, I’ve noticed an interesting development with the Stochastic Relative Strength Index (RSI). This tool indicates price momentum and right now, it’s at its lowest point. This could potentially mean we’re about to see a reversal and a cross back up might be imminent.

Weekly price momentum has topped out

Over the course of a week, the price appears to have consistently followed an upward trendline. Yet, it’s important to note that the Stochastic RSI, when viewed in this timescale, has recently shown a downward crossover of its indicators from their highest points, which could potentially signal a change in momentum.

Based on the analysis of the Stochastic RSI, it’s clear that during the 2021 bull market, instances where this indicator gave a false signal were quite rare. To be precise, there were only two such occurrences: in September 2021 and March 2023. However, it’s important to note that the current week is not yet over, so we can’t definitively say that the recent cross-down is a false signal until the end of Sunday.

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2024-11-26 14:03