Bitcoin’s recent price drop has left many investors wondering if now is the right time to buy. The world’s most valuable cryptocurrency plunged by over 5% in a single day, falling below the $60,000 mark. This downward trend has been a cause for concern for many, especially after the gains seen over the weekend.
Despite the sell-off, one analyst believes that now is the perfect opportunity to accumulate more Bitcoin. According to a post on X, the analyst suggests that Bitcoin is on the verge of entering the “Spring” phase within the Wyckoff re-accumulation model. This model is a technical analysis tool that uses price and volume patterns to predict potential price movements.
The “Spring” phase is crucial in the Wyckoff model as it often precedes a significant price breakout. When Bitcoin prices “spring” higher from this stage, they tend to break out of their current range with increasing trading volume. Currently, Bitcoin is retesting its primary support level, with prices dropping below $60,000 and hitting as low as $56,900.
On the other hand, not everyone is optimistic about the current state of the market. On-chain analyst Willy Woo attributes the recent sell-off to miner capitulation. Since the Bitcoin network halved BTC rewards in April, miners have been facing increased pressure to operate profitably. Inefficient miners are now being forced to exit the market, leading to a drop in Bitcoin prices.
Despite the concerns raised by Woo, long-term holders of Bitcoin, such as institutions and whales, have not been selling their holdings. Data shows that the “illiquid supply” of Bitcoin, which represents coins that haven’t been moved in over two years, is at a near all-time high. This indicates that institutional investors are holding onto their Bitcoin, possibly in anticipation of future price increases.
In conclusion, the current price drop in Bitcoin has divided opinions among analysts and investors. While some believe that now is the time to buy and accumulate more Bitcoin, others are cautious due to concerns about miner capitulation. As always, it’s essential for investors to conduct their own research and consider the risks involved before making any investment decisions in the volatile cryptocurrency market.