Key Takeaways

  • Bitcoin fell below $32,000 today, just 15 days after the leading crypto asset hit its all-time high price of ~$41,940. Accumulation patterns have naturally ended, with hodlers characteristically taking profits on this BTC run-up. Similar to other cycles and prefaced in previous BTC Outlooks, large BTC intraday drawdowns remain. While 10%+ drawdowns shake conviction, these moves have been met with strong bids.

  • Surprising to most analysts was the rate at which BTC moved past its previous all-time highs. In conjunction, this led to overextension in many cycle indicators. This morning’s sell-off led to healthy corrections in cycle indicators – particularly SOPR. Shaking out profit takers and “weak hands” is necessary for BTC to make strides upwards. MVRV and the Puell Multiple also saw healthy corrections. The % of addresses in profit still remain >90% and an uptick in miner exchange inflows may suggest further correction in the short-term.

  • Price weakness in the early months of a new year is familiar territory for bitcoin, which historically has struggled in January and March relative to the rest of the year. Bitcoin has followed in 2020’s footsteps thus far this year, but we’d point to BTC’s poor performance in February and March following its +30% gain last January. Zooming out, BT

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