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Bitcoin Drops Below $30,000 Again – Is the Bullish Trend Over?

January 27, 2021 at 21:29 by Mark Stevenson

On January 27, Bitcoin (BTC) price plunged again below $30,000 after the bulls met resistance at highs near $33,000. Consequently, at around 18:45 GMT, the price of the leading cryptocurrency dropped to $29,499.

However, at the time of writing, the price of one bitcoin has returned to levels above the psychological level of $31,505.

Notably, on the morning of January 22, the price of the leading cryptocurrency nosedived from a high of $35,600 to $29,000. Although Bitcoin price held a round mark at the end of the week, crypto analysts did not rule out the possibility of a new fall then.

For instance, CryptoQuant CEO Ki Young Ju pointed to the “Coinbase Index”, which exceeded 50 when BTC prices rose and dropped below -122 on Friday. According to him, this is an indication that large investor sold their bitcoins. Earlier the CEO said he wasn’t sure that the Bitcoin whales would allow the price to drop below $30,000, since many invested at close levels.

Furthermore, analysts also noted a significant drop (from 38% to less than 3%) in the share price of the Grayscale Bitcoin Trust (GBTC) over the past month. From their point of view, institutional investors, who are the main buyers of the trust securities sold a Bitcoin-based investment instrument.

Will Bitcoin resume the bullish trend?

Following today’s Bitcoin price drop, Ki Young Ju said it seems Coinbase whales are starting to buy Bitcoin as the Coinbase Premium rose to the level of $66, which corresponds to bullish sentiment.

What is more, the growing number of wallet addresses containing more than 1000 bitcoins points to the completion of the downward correction. A new record has been set here — 2446 addresses. In the last 20 days alone, there have been 140 more of them, which may indicate the readiness of large investors for the growth of BTC in the near future.

In general, all this supports the theory of the transition of assets from small players in the crypto market to wealthier bitcoin owners who only hoard coins without considering selling them.

As a reminder, Scott Minerd, the director of investments at Guggenheim Partners predicted that the Bitcoin price will rally to $400,000 but warned traders about a possible correction. In his opinion, if the decline in BTC is prolonged, and the price may fall to $20,000.

If you have any questions and comments on Bitcoin today, use the form below to reply.

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