Bitcoin dropped to a 3-month low near $86,000 on Feb. 25 and while data hints at further downside, BTC whales have also been accumulating.
After weeks of defending its long-term market structure, BTC (BTC) finally broke down, and the move could persist over the next few weeks.
Bitcoin 1-day chart. Source: Cointelegraph/TradingView
Bitcoin whales move $2.3 billion in BTC
With the crypto asset currently down roughly 10% for the week, Bitcoin researcher Axel Adler Jr said that this is BTC’s largest quarterly drop of ~20% since August 2024. The current drawdown is also twice as big as the average Bitcoin drawdown of 8.9% over the past year.
Bitcoin price drawdown analysis. Source: CryptoQuant
The sharp correction also affected short-term holders (STH), with addresses that held BTC for less than 155 days moving 27,500 BTC at a loss over the past 24 hours.
On the flip side, Bitcoin whale addresses appear to be making moves. Data from CryptoQuant suggested that 26,430 BTC were deposited to whale accumulation addresses on Feb. 24. These addresses are generally linked to “OTC deals and long-term custody.”
It is worth noting that earlier in the week, Strategy announced the purchase of 20,356 BTC for $1.99 billion, as reported by Cointelegraph.
Related: Bitcoin price enters generational buying territory — Should traders expect more downside?
Bitcoin may bounce between $85,000 to $81,000
Bitcoin’s daily candle closed below the $92,000 range on Feb. 24, confirming the double-top pattern that has been present for months. With a sharp bearish reaction occurring right after the pattern’s completion, the technical drawdown is estimated to be 16% from the neckline, around the $78,000-$76,000 level.
Bitcoin 1-day chart. Source: Cointelegraph/TradingView
As illustrated in the chart below, a fair value gap between $81,700 and $85,100 was formed on Nov. 11, 2024. This liquidity gap was not filled, and Bitcoin could eventually find bidders in this zone.
CRG, an anonymous crypto trader, highlighted a big cluster of spot bids on Binance around $84,000 to $86,000, adding the confluence of the fair value gap.
Bitcoin spot bid cluster. Source: X.com
It will be important to observe Bitcoin’s reaction in this region, where a potentially dead cat bounce might occur.
If Bitcoin does not respect the support level of $81,000, the final support rests between the CME gap at $77,000 and $80,000. A drop to $77,000 will also complete the estimated price target of the double-top pattern.
Related: Bitcoin enters 'technical bear market' as BTC price drops 20% from all-time high
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.