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Here’s Why Bitcoin (BTC) Price Could Retrace by 27%

3 mins
Updated by Ryan Boltman
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In Brief

  • The number of addresses holding more than 1,000 BTC has been decreasing since March 5.
  • Roughly 100% of addresses are now in profit, which could lead to selling pressure soon.
  • Although EMA Cross lines appear bullish, whales movements and profitable addresses could lead to corrections in the short-term.
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Bitcoin’s (BTC) journey to $100k seems to be inevitable. However, this doesn’t mean that it will not have ups and downs. Although the BTC price has been breaking new all-time highs repeatedly, on-chain data suggests that a correction could happen soon.

Understanding how profitable wallets and whales are can indicate that the BTC price could be corrected by 27% soon.

The Number of Profitable BTC Holders Is Almost 100%

Due to BTC’s recent surge, consistently setting new all-time highs, the proportion of holders enjoying profits has approached nearly 100%. This level of widespread profitability among BTC investors has not been observed since November 2021, when the metric soared to 93.8%.

BTC Historical Break Even Price.
BTC Historical Break Even Price. Source: IntoTheBlock.

After reaching that high point, BTC underwent several price adjustments in the next five weeks. Its market price fell sharply from $65,218 to $36,982, representing a significant decline of roughly 43.29%.

This trend indicates that many investors may soon prepare to secure their profits. This potential move by investors to liquidate their holdings could lead to a notable increase in selling pressure on Bitcoin. Such a dynamic shift in the behavior of Bitcoin investors could significantly influence BTC market stability, potentially resulting in downward price movements.

Some Whales Are Moving Out

The count of Bitcoin addresses holding at least 1,000 BTC has steadily climbed from 1,486 on January 13 to 1,592 by March 5. Nonetheless, a slight decline was observed from March 5 to March 13, with the total falling to 1,579 addresses.

The present count exceeds the number of whales noted in January. Yet, the latest decrease in addresses holding at least 1,000 BTC could suggest that these investors are starting to liquidate their positions. They might believe that Bitcoin has reached its current maximum value, at least for the short term.

Number of Entities With More Than 1,000 BTC.
Number of Entities With More Than 1,000 BTC. Source: Glassnode.

Although this shift by itself may not immediately cause a widespread sell-off, it has the potential to influence the market sentiment of other investors. This change in perception regarding BTC’s short-term direction might be enough to prompt a noticeable adjustment in the market.

The implication of these large holders beginning to sell could signal to the broader market that now might be a strategic point to consider taking profits. Consequently, this perception could lead to cautious trading behaviors, further impacting BTC price stability and potentially ushering in a period of price recalibration.

BTC Price Prediction: EMA Lines Still Bullish

The BTC 4-hour price chart shows that all EMA lines are below the price line, which is usually bullish. Another bullish signal is that the long-term EMA (100 and 200) is below the short-term ones (20 and 50).

EMA (Exponential Moving Average) cross lines identify trends and potential turning points by smoothing out price data over specific periods.

When a shorter-term EMA crosses above a longer-term EMA, it’s often interpreted as a bullish signal, suggesting an uptrend. Conversely, when a shorter-term EMA crosses below a longer-term EMA, it’s seen as a bearish signal, indicating a potential downtrend.

BTC Price and EMA Lines.
BTC Price and EMA Lines. Source: TradingView.

However, this doesn’t mean a correction couldn’t occur before the uptrend continues. If BTC’s price cannot sustain the $67k support, it could go down as much as $52k, a potential 27% correction. However, if BTC can continue its uptrend despite the decrease in the number of whales and the high percentage of profitable addresses, it could soon reach $75k or $80k.

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In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

Tiago Amaral
Marketing professional turned coder, passionate about code, data, crypto, and writing. I hold a Marketing and Advertising degree and a Disruptive Strategy certification from Harvard Business School. I love querying blockchain data and discovering insights hidden in data.