Crypto Crash: Bitcoin Slides to $96K as Ethereum Retests Key $3.2K Support

With incoming on-chain data, it has become apparent that long-term holders are indiscriminately selling Bitcoin. This widespread profit-taking has led to a crash in Bitcoin’s price.

A similar event happened to Ethereum as it has been retesting its $3200 support. Ethereum had recently bottomed near the $3000 mark but was able to resurface to its key support level at $3200.

Even with the US government reopening possibilities going up, the market seems to be in an uncertain position. With such extensive profit-taking in place, what will happen to Bitcoin is the question that everyone is asking.

The Crash of BTC Prices

Chain analytics firm Glassnode has been discussing the matter on X publicly after Bitcoin suffered such a crash. Earlier, Bitcoin wasn’t expected to drop below the key support level set at $100,000. However, things may not be going well for Bitcoin at the moment, according to industry experts.

Glassnode noted that LTH(Long Term Holders), who usually hold the assets of the market for extensive periods ranging from 155 days, have now re-entered the market to cash out at what seems to be a safe point. With today’s Bitcoin Fear and Greed index being 16, indicating extreme fear, it is becoming obvious that the long-term holders are in a panic.

As it has become obvious that the long-term holders are into selling, their activity needs monitoring. From what data could be accumulated about the past activities of these long-term holders, it has come to notice that they had made such massive sales during the 2024 rally, too. However, between each selling phase, they had accumulated more than what they had sold. This is suggestive of an aggressive accumulation before distribution.

This rapid sell-off came at a time when Bitcoin was already struggling to break key resistance points, which had been coming down over the past week. The sell-off then amplified the market’s bearish momentum. From what can be inferred about the sentiment of the long-term holders, many are viewing this as their final opportunity to cash out without major reductions in profits.

This has been identified as the major reason why Bitcoin’s price has crashed over the past few days.

Historically, however, such bear markets have been followed by strong bull markets. As stronger buyers enter the market who see this as an opportune moment to enter the market, the selling pressure gradually cools off. Such a fresh demand has acted as a booster for bullish momentum that is to come. In contrast, if buyers fail to step in at the right time, the selling pressure could deepen, driving the price down further.

What Happened With Ethereum

Ethereum is not in a good position at the moment, it seems. While the price targets remain at 4955 and 5766, the current pullback is a threat to Ether’s price acceleration. If the pullback is strong enough, it could bring Ethereum down to the support levels at $2800 and $3000.

Historically, the above support level has been a strong one, indicating that even if the prices drop to this level, Ethereum could bounce back with strong buyers coming into the market. With prices approaching this support level, experts analyze that the broader risk-to-reward will increase.

This is a positive aspect as Ethereum’s strong floor may well be considered as a potential entry point by investors. This could boost Ethereum’s chances of rebounding.

Conclusion

This recent market turbulence could be the result of opportunistic investors taking profit; however, enthusiastic investors may see this downturn as a potential entry point, which could stabilize the prices and reduce the downward momentum.

Ethereum’s retest of $3200 level induces caution; however, a further drop could attract buyers who might consider this an opportune moment to enter the market.

Historically, these volatile bearish markets have been an indicator of strong bullish markets that are yet to come, so investors must continue monitoring key support and market sentiment closely. The supports, cycles, and sentiments could very well be the deciding factor in the next trajectory of cryptocurrencies.

Also Read: SharpLink Reports Impressive 1,100% Y-O-Y Revenue Increase Driven by ETH Treasury Strategy