The leading cryptocurrency, Bitcoin (BTC), continues to decline due to factors such as negative economic data from the US, declining investor confidence, and a decline in Fed interest rate cut expectations.
Bitcoin, which has fallen more than 2% in the last 24 hours, is trading at $115,200, and it remains unclear whether the decline will continue.
At this point, CryptoQuant analyst with the nickname Crazzyblockk analyzed that it is of great importance for Bitcoin to maintain the $118,000 level to avoid further decline.
Stating that $118,000 is critical support for Bitcoin, the analyst stated that this level represents the average entry price for investors who bought last month and own approximately 1.69 million BTC.
According to the analyst, this level makes it a critical benchmark for interpreting short-term market momentum. The behavior of these new investors plays a significant role in shaping both market dynamics and healthy uptrends in each cycle.
“These new investors first strengthen structural demand in the market by absorbing the supply dispersed from the old groups, creating new demand and capital inflows. Secondly, the desire to enter Bitcoin determines the short-term demand, which reflects market sentiment, confidence, and market appetite. At this point, as long as the spot price is trading above its average cost basis, these new investors remain in profit and are more inclined to speculate on further gains, supporting the rally.”
At this point, the analyst noted that Bitcoin is currently trying to defend the critical threshold of $118,000, which is of great importance for the short-term price trend.
According to the analyst, holding above $118,000 will confirm the recent uptrend and re-energize the recovery momentum. However, the analyst warned that in the opposite case, that is, a drop below $118,000, Bitcoin and the market could face the risk of further decline and a new correction.
“…. This level should be closely monitored for investors and short-term participants. Protecting $118,000 could serve as a green light for a bullish position, while a failed defense could serve as a warning signal in a rising market risk environment.”
*This is not investment advice.