Bitcoin Faces Major Leverage Downside - Analyst Explains Sub-$100,000 Price Drop

Bitcoin faced significant selling pressure after successfully surpassing the $100,000 milestone, a psychological milestone that excited investors. However, this joy was short-lived as BTC failed to hold onto this key level, dropping to as low as $92,500 in less than three days. This sharp decline has raised concerns about market stability and the sustainability of Bitcoin's upward momentum. Axel Adler, a renowned analyst at CryptoQuant, shared valuable insights into recent market activity. He revealed that the largest leverage liquidation occurred between January 6th and 7th, as the price of Bitcoin dropped from $102,000 to $100,000 due to liquidation. This forced selling wave pushed the price even lower, allowing short sellers to regain control and push the price of Bitcoin down to $92,500. The current market situation has raised questions among investors about the next move of Bitcoin. Will it stabilize and find support for another price increase, or will the downward momentum lead to a deeper correction? With market sentiment oscillating between fear and cautious optimism, all eyes are still on Bitcoin as it surpasses this crucial stage. Bitcoin regains its position after a strong sell-off Despite experiencing a sharp decline that sent Bitcoin plummeting to $92,000, the cryptocurrency has found crucial support at this level. Over the past few hours, BTC has surpassed this threshold, rising to $95,000, bringing hope to optimistic investors. The ability to hold steady and recover from this support level indicates potential for recovery, but there is still much instability. CryptoQuant's renowned analyst, Axel Adler, has shared in-depth data about X's market dynamics recently. He noted that the largest leverage liquidation occurred around January 6th and 7th, when the price of Bitcoin dropped from $102,000 to $100,000 due to a wave of liquidations. This liquidation event wiped out excessive leverage positions and set the stage for a price decline. Taking advantage of the chaos, the selling side opened short positions, pushing the price down to $92,000.

Despite the recent recovery, Adler warns that the current 9K BTC drop in open interest (OI) does not provide a definite signal of easing pressure in the market. This makes Bitcoin's next move uncertain, with investors closely monitoring price movements in the coming days. The recovery to $95,000 is a positive sign, but BTC needs to reclaim higher levels to confirm the price increase and stabilize the market. Until then, traders remain cautious as the possibility of continued volatility persists. BTC holds important level: Bulls Eye High Ground Bitcoin is trading at $95,000, holding above the important support level and only down 2% from the 4-hour EMA 200 line at $96,200. The 200 MA line, another important indicator, is 3% away, adding further significance to Bitcoin's current position. These technical levels play a crucial role in assessing short-term market dynamics and potential price recovery.

To reclaim the upward trend, the $95,000 level must be maintained as a foundation for further upward movement. It is crucial to make decisive moves towards reaching the $98,000 and $100,000 levels. These price levels serve as significant resistance levels, and once surpassed, they could pave the way for a strong rally, enabling Bitcoin to return to its all-time high. Failing to hold above $95,000 could open the door to increasing selling pressure, potentially pushing BTC into a deeper consolidation phase or even testing lower demand areas. However, maintaining the current level and building momentum could restore investor confidence and create the necessary conditions for sustained price growth. When Bitcoin consolidates, both traders and analysts closely monitor these important levels to assess the next move of the cryptocurrency. A breakthrough above the $100,000 mark could reignite the bullish sentiment and establish a clearer direction for the market.