The current price of Bitcoin, at $78,427.15, may be poised for a downturn despite being slightly up. Having gained less than 0.5% since midnight UTC, significant moves towards $80,000 are anticipated to meet with resistance.
According to Luke Deans, a senior research associate at Bitwise, short-term holders have a cost basis around $80,000, which could prompt them to sell and realize profits, thus limiting any potential price increase. Furthermore, the upcoming US March PCE inflation report, coupled with high oil prices and rising bond yields, may exert downward pressure on the market. The recent decision by the Federal Reserve to maintain the federal funds rate, accompanied by dissenting voices, has also contributed to market uncertainty. Deans notes that altcoins are closely tied to Bitcoin, with a high correlation and beta percentiles of nearly 97% and 99%, indicating that they may move in tandem with Bitcoin.
He also warns that beneath the surface, conditions are forming that typically precede increased volatility, characterized by subdued liquidity and a lack of directional conviction, suggesting that price movements may be necessary to unlock new liquidity.