Despite a notable surge of nearly 10% between March 5 and 6, reaching heights close to $92,000, Bitcoin continues to navigate a landscape of uncertainty. With BTC dropping below the $90,000 threshold for the third time this week, on-chain data suggests a pivotal moment for the flagship cryptocurrency that may indicate a potential bullish phase ahead.
A New Accumulation Cycle For Bitcoin Looming?
As market volatility remains persistent, Bitcoin’s price now stands at a critical juncture, presenting an opportunity for future trends. Advanced investment and on-chain platform Alphractal has shed light on this development through its updated Bitcoin Alpha Price metric.
Recent analysis using the Alpha Price metric reveals that BTC has reached an important zone that warrants close attention in the coming days. This significant region may catalyze the onset of a new accumulation phase, suggesting renewed interest from long-term investors.
Historically, similar price levels have been indicative of moments of indecision that often precede considerable bullish or bearish trends. Alphractal contends that the current region visited by BTC represents the last critical support level before a potential severe downward movement.
However, the prevailing scenario for BTC may involve a price capitulation should the asset make gains yet fail to hold critical support levels, as indicated by historical trends. Importantly, this support level has remained respected over the past year.
After reaching this crucial zone, market participants have noted that the current price action mirrors movements observed during the 2021 cycle, specifically between April and May. If this correlation holds, Alphractal suggests that it does not necessarily signify a bearish market but rather a liquidity sweep targeting long positions.
Nonetheless, if Bitcoin sustains its position above the specified area indicated in the accompanying chart, the market is likely on the verge of entering a new accumulation cycle, heralding the end of the ongoing correction. Such a shift could catalyze further price increases in the months ahead.
Investors Showing Renewed Confidence In BTC
The recent days have posed challenges for Bitcoin amidst ongoing price fluctuations. However, optimism among BTC investors appears to be regaining traction, sparking accumulation among small or retail holders.
Data from Santiment reveals a significant uptick in small BTC wallet addresses during the current market volatility. This surge aligns with BTC’s rebound to $90,000, a level it has fluctuated around since early March.
Presently, the network has seen an increase of 50,000 wallets compared to the previous month. Wallets containing less than 0.1 BTC have risen by 37,390, while those holding between 0.1 and 100 BTC have also seen a rise of 12,754.
Interestingly, wallets with at least 100 BTC have decreased minimally, with only six fewer. According to Santiment, a resurgence in wallets holding 100 BTC could signal a potential breakout across the cryptocurrency market.
