Bitcoin’s $2.16B Sell-Off: Will BTC Recover or Drop Further?

• Bitcoin traders lost $2.16B as BTC fell under $90K support.
• Whales dumped 6,813 BTC, increasing the market’s downward pressure.
• Oversold signals suggest a possible price rebound if buyers return.

Bitcoin has seen a sharp correction, breaking below $90,000 for the first time since November 2024. Between February 25 and 27, Glassnode data reveals that traders suffered $2.16 billion in realized losses, with newer market entrants facing the heaviest losses. Analysts weigh in on whether BTC could sink further toward $80,000 as panic spreads.

Panic Selling Adds to Market Pressure

Market sentiment has taken a hit, with many traders exiting their positions in fear. Ki Young Ju, CEO of CryptoQuant, highlighted that such pullbacks are typical in a Bitcoin bull cycle. He noted that in 2021, BTC experienced a 53% correction before hitting a new all-time high.

According to Ju, selling in a downturn is the worst strategy. History shows that Bitcoin often rebounds after significant crashes. He believes panic selling results in greater losses, while experienced investors hold through volatility.

Short-Term Holders Suffer the Most

Glassnode reports that traders who bought Bitcoin within a week before the crash absorbed most losses. Their rushed liquidations intensified Bitcoin’s decline.

Conversely, long-term holders who accumulated BTC in mid-2024 or earlier remained largely unaffected. Glassnode’s analysis indicates that seasoned investors are holding firm while newer traders are exiting under pressure.

Technical Analysis: BTC Struggles to Hold Support

Bitcoin’s daily chart shows a breakdown from a local trendline, pushing the price below S1 support at $91,265. BTC briefly dipped to $83,937 before rebounding to $86,607.

A bullish harami pattern has emerged, hinting at a potential short-term recovery. However, BTC must close above $84,000 to avoid further downside. Failure to hold this level could lead to another drop toward S2 at $80,119.

For a recovery, BTC must reclaim $90,000, with strong resistance at $91,265. If Bitcoin breaks above this level, bullish momentum could return.

Whale Activity Drives Market Uncertainty

Santiment data shows that whales and sharks have dumped 6,813 BTC in the past week, intensifying market pressure. Large holders reducing their positions often trigger panic selling among retail traders, adding to volatility. Historically, such sell-offs have led to deeper market corrections, pushing Bitcoin’s price lower before a potential rebound.

Meanwhile, crypto analyst Ali Martinez pointed out that Bitcoin has entered oversold conditions for the first time since August 2024. Back then, BTC saw a 33% surge after reaching similar levels.

Another key on-chain metric suggests that BTC tends to recover when traders realize losses hit -12%. Currently, this figure stands at -8.25%, indicating room for more downside before a reversal.

Will BTC Drop to Below $80K?

Bitcoin’s $84,000 support level is critical. A breakdown could lead to below $80,000, while a reclaim of $91,265 could shift momentum. With whale movements and investor sentiment shaping the market, traders are watching for the next significant move.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.