Bitcoin Price Crash Possible Amid Overbought Market Conditions and Increasing Profit-taking Sentiments, Analysts Predict

According to Cointelegraph: Bitcoin's recent price dynamics suggest a potential major correction phase after a robust price rally in 2024. Bitcoin's BTC/USD pair is currently down approximately 13.5% from its year-to-date (and all-time) high near $74,000. The ongoing price retreat looks to be a bull market correction equivalent, an opportunity for the market to adjust and consolidate gains before potentially climbing again. BTC/USD weekly price chart. Source: TradingView History shows that adjustments during previous bullish cycles have resulted in a 20-40% format, which suggests a similar downturn may occur during the 2024 bull market. BTC/USD weekly price chart. Source: TradingView Furthermore, Bitcoin's current price surge has pushed its market into a deeply overbought state. As of March 22, Bitcoin's weekly Relative Strength Index (RSI) was roughly 77 – a level above 70 signals overbought market conditions and a likely price correction as traders may look to sell their holdings. Bitcoin NUPL vs. price. Source: CryptoQuant Additional indicators of a possible Bitcoin price crash come from its Net Unrealized Profit/Loss (NUPL) data, a measure that shows the propensity for profit-taking and increased selling pressure, which in turn leads to significant Bitcoin price declines. BTC/USD weekly price chart. Source: Rekt Capital/TradingView According to analysts like Rekt Capital, Bitcoin is entering a "Danger Zone" after its latest fall, with the price potentially dropping to the $40,000-42,000 area before the halving event in April. Conversely, trader Aksel Kibar forecasts the BTC price to stabilize around $57,500. BTC/USD weekly price chart. Source: Aksel Kibar/X

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