The Bitcoin price is bleeding while Ethereum has hit a new all-time high of $4,900. Although BTC slipped after hitting a new record of $124.73k, it managed to sustain its bullish momentum. After hovering around the $117k level, the pioneer crypto saw a steep decline today, dipping below its critical support level of $112k. What drives this bearish trend?
Bitcoin Plummets Below $112K: A Sign of a Larger Market Crash?
Currently, Bitcoin is experiencing a negative trend, with its price plummeting below $112,000. At press time, the cryptocurrency is trading at $111,145, 3.5% down in a day. Over the past week and month, BTC has declined by 3.9% and 5.7%, respectively.
Despite this dip, traders remain bullish about the pioneer cryptocurrency’s potential uptrend. The 24-hour trading volume is currently at $80.85 billion, up 51%. This massive surge highlights the positive traders’ sentiment.
However, analysts and experts continue to hold a bearish outlook on the Bitcoin price. For instance, crypto analyst Merlijn The Trader took to X to share insights on BTC’s possible crash. While BTC traded around the critical $112 support zone, the analyst predicted that the crypto could plunge to a lower range if it fails to break past the level.
Significantly, the chart presented by him indicates that the Bitcoin price could even fall below the pivotal $100k once again, given its current loss of support. However, if BTC surges above $112,000, it could retrieve its ATH of $123k.
Similarly, analyst BitBull suggested that a drop to $106k-$108k is possible before the next leg up. He added that BTC’s bounce back from the 50-EMA level doesn’t necessarily mean that the bottom level has been reached.
Why is Bitcoin Down Today?
Significantly, Bitcoin’s prevailing bearish trend is driven by multiple factors. One of the primary drivers is the increasing BTC sell-off and whales’ shift to Ethereum.
Interestingly, Bitcoin saw a sudden loss of more than $4k when a whale, who has been dormant for five years, sold their entire 24,000 BTC holdings. Wallet address “19D5J…WoZ1C” moved these coins in multiple batches to various addresses over the past. On Sunday alone, the whale moved 12k coins to the Hyperunite trading platform and is reportedly still “actively selling.”
According to Bitcoin enthusiast Willy Woo, the BTC price trend is highly influenced by OG whales. He wrote,
“BTC supply is concentrated around OG whales who peaked their holdings in 2011. They bought their BTC at $10 or lower. It takes $110k+ of new capital to absorb each BTC they sell…This differential in cost basis, the supply they hold and their rate of selling has profound impacts on how much new capital that needs to come in to lift price.”
Whales Choose Ethereum over Bitcoin
Another OG whale sold 100,784 BTC to buy 62,914 ETH and established a 135,265 ETH derivatives long position. In exchange-traded funds as well, there is growing demand for ETH over BTC. As institutional investors prefer Ether over BTC, the market has larger inflows in ETH ETFs and more outflows in Bitcoin ETFs.
This trend reversal has significantly impacted the prices of both cryptocurrencies. While Bitcoin dipped below its critical support level, ETH surged past the key resistance zone to hit a new all-time high of $4,900.
