Will Bitcoin (BTC) Price See a 27% Pullback?

The journey of Bitcoin (BTC) to $100,000 seems inevitable. However, this does not mean it will be without fluctuations. Despite Bitcoin’s price reaching new highs, on-chain data suggests a pullback could happen soon.

Understanding the profitability of wallets and whales indicates that a 27% pullback in BTC price might be imminent.

BTC Holder Profitability Nears 100%

With BTC’s recent surge to record highs, the proportion of holders enjoying profits is nearing 100%. Since November 2021, such widespread profitability among Bitcoin investors has not been seen, when the metric soared to 93.8%.

After reaching this peak, Bitcoin experienced several price corrections over the following five weeks. Its market price plummeted from $65,218 to $36,982, a drop of approximately 43.29%.

This trend suggests that many investors might soon be ready to take profits. The potential move by investors to liquidate their holdings could significantly increase Bitcoin selling pressure. Such dynamic changes in Bitcoin investor behavior could significantly impact the stability of the Bitcoin market, potentially leading to a price decline.

Some Whales Are Migrating Out

The number of Bitcoin addresses holding at least 1,000 BTC steadily climbed from 1,486 on January 13 to 1,592 by March 5. However, from March 5 to March 13, there was a slight decline in the number of Bitcoin addresses, dropping to 1,579.

The current number surpasses the whale count recorded in January. Yet, the recent decrease in addresses holding at least 1,000 BTC might indicate these investors are beginning to liquidate their positions. They may believe that Bitcoin has reached its current peak, at least in the short term.

While this shift may not immediately trigger widespread selling, it has the potential to affect the market sentiment of other investors. This change in the short-term outlook for BTC could be enough to prompt a significant market adjustment.

Hints of these major shareholders starting to sell could signal to the broader market that now might be a strategic point to consider taking profits. Therefore, this view could lead to cautious trading behavior, further affecting the stability of Bitcoin prices, and possibly ushering in a period of price readjustment.

BTC Price Prediction: EMA Lines Remain Bullish

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

EMA (Exponential Moving Average) crossover lines identify trends and potential turning points by smoothing price data over a specific period.

When short-term averages cross above long-term averages, it is often interpreted as a bullish signal, indicating an uptrend. Conversely, when short-term averages are below long-term averages, it is seen as a bearish signal, indicating a potential downtrend.

However, this does not mean corrections won’t occur before the uptrend continues. If BTC’s price fails to hold the support level of $67,000, it could fall to $52,000, potentially seeing a 27% pullback. Yet, if BTC continues its uptrend despite a decrease in whale numbers and a high proportion of profitable addresses, it could soon reach $75,000 or $80,000.

Sentiment: Neutral