Bitcoin (BTC) price made headlines recently after teasing a new all-time high (ATH) during the inauguration of pro-crypto US President Donald Trump. However, the excitement was short-lived as the flagship coin closed Monday in a shooting star candlestick pattern, hinting at a potential reversal in the market. This comes after Bitcoin has been on a bullish run since January 2023, with significant gains being recorded.
The increased volatility in the crypto market has led to more than $638 million being liquidated in leveraged trades, with a majority of losses coming from long traders. This has raised concerns about a possible long squeeze, which could further dampen bullish sentiment in the near future.
Market analyst @Htltimor from the X platform believes that Bitcoin may have reached the top of its current bull cycle, signaling the start of a distribution phase. This phase typically precedes a macro bear market, and the analyst predicts that Bitcoin could see a decline towards $85k in the coming months. This would pave the way for a multi-quarter accumulation phase leading up to the 2028 halving event.
Despite the potential bearish outlook, whale investors remain undeterred in their support for Bitcoin. Data from Coinglass shows that the overall supply of Bitcoin on centralized exchanges has been dwindling, currently standing at around 2.19 million. The approval of spot BTC ETFs in the US in 2024 has played a significant role in boosting bullish sentiment, with funds like BlackRock’s IBIT and Fidelity’s FBTC accumulating over $120 billion in net assets.
In addition, companies like MicroStrategy Inc. (NASDAQ: MSTR) have continued to bolster their Bitcoin holdings by leveraging global capital markets. This indicates a strong belief in the long-term potential of Bitcoin, despite the current market uncertainties. As the crypto landscape continues to evolve, it will be interesting to see how these developments shape the future of digital assets.