Bitcoin, which has experienced a 1% increase in the last 24 hours, continues to trade above the $ 105,000 level. However, it should not be forgotten that despite the market’s bullish expectations, corrective periods are inevitable and are part of the overall market cycle. On-chain data shows that the correction period is approaching.
Bitcoin’s Entry into the Distribution Phase
CryptoQuant’s Bitcoin Cycle Indicators Index (IBCI) shows that the asset has re-entered a distribution zone after eight months. The IBCI indicator is an analysis tool that combines a total of seven market indicators such as Puell Multiple, MVRV, NUPL and SOPR.
Source: CryptoQuantWhen the index reaches the red zone, which starts at the 75% level, it indicates that the distribution process has started. This level indicates that BTC still has growth potential but selling pressure is increasing. Once the IBCI reaches 100%, BTC is expected to reach a new all-time high and the price will form lower highs and lows. BTC’s IBCI level, currently above 50%, indicates that a corrective period is coming soon.
Bitcoin May Fall to 90 Thousand Dollars
Another analysis identified possible demand zones where BTC could experience a corrective decline and then recover. An on-chain metric called “Coin Condition Around Price” was used to identify support and resistance zones on price charts.
Source: IntoTheBlockThis metric points to a demand zone between $94,800 and $97,000. Approximately 1.4 million addresses support this range with 1.36 million BTC buy orders. A drop to this region is expected to be followed by a recovery period that could result in BTC re-passing the $100,000 level. Additionally, other developments in market activities may also favor BTC.
US Digital Asset Stock Could Help Bitcoin
An executive order announced by Donald Trump on January 23 announced that the United States would create a stockpile containing digital assets. It is thought that BTC will also be included in this stock.
New Cryptocurrency Rules Approved in the USA: DeFi Tax is Coming…According to data provided by Arkham, the US government currently owns approximately 198,000 BTC, an asset worth $20.71 billion. Increasing these assets by the government may positively affect BTC’s price movements by increasing demand.
