The price of Bitcoin, currently at $79,854.07, may be due for a correction despite being slightly up. Having gained less than 0.5% since midnight UTC, any significant push towards $80,000 is likely 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, thereby limiting any potential advance. Additionally, the upcoming US March PCE inflation report, coupled with high oil prices and rising bond yields, may further weigh on the market.
The recent decision by the Federal Reserve to maintain the federal funds rate, accompanied by an unusually high number of dissenting voices, is also impacting market sentiment. Deans noted that altcoins continue to closely follow Bitcoin's movements, with a high correlation and beta percentiles of nearly 97% and 99%, indicating that tokens may behave like leveraged Bitcoin trades.
He also observed that beneath the surface, conditions are forming that typically precede increased volatility, characterized by subdued liquidity and a lack of directional conviction, suggesting that significant price movements may be necessary to unlock new liquidity.