Bitcoin saw further declines on Friday morning. It retraced from $84,621, losing the $80k support, to a low of $78,197.
The apex coin is currently facing significant selling pressure below $80,000. It continues its downtrend after rebounding during the previous intraday session.
BTC started Thursday at $84,150 and surged to a high of $86,988. The uptick ended with the top coin retracing to a low of $82,615 before rebounding and ending the day at its opening price.
The asset uptick sparked hopes of a recovery during the previous intraday session. However, the decline dampened the positive sentiment across the market.
Bitcoin reacted to the release of US economic data. It sparked mixed reactions, and the readings differed. Analysts predicted the fourth quarter Gross Domestic Product to be 2.3%, which is significantly lower than Q3 2024.
The data came out as predicted, marking another quarter with GDP above 2%. Reports on inflation suggest no sudden growth, which is healthy for the economy. However, the adverse market reaction came as the GDP deflator rolled in. It came in higher than expected; the forecast was 2.2% against the published 2.4%.
Analysts agreed that the US economy was healthy in December 2024, and Biden handed Donald Trump a strong economy.
Nonetheless, the slight change in GDP and previous job claims fueled fears of heightening inflation. The last forecast for this metric was 222k. It came in at 242k, over 20k higher than the predictions.
What Caused the Ongoing Decline?
Investors lost faith in the US President. Donald Trump’s campaign was focused on promises regarding the crypto industry. Many expected the market to see massive inflows once he took office. However, these expectations came to an abrupt end when he introduced a series of policies that threatened inflation and recession.
Although he delivered on softening the strong US SEC stance on crypto. Confidence in the President significantly.
Bitcoin May Consolidate
Data from CryptoQuant shows the apex coin is seeing notable buying action at the time of writing. Exchange reserves are on the rise as traders withdraw assets from these platforms. The NetFlow is -124%, indicating more withdrawals at the time of writing compared to the previous day.
Long-term holders are more bullish as fewer are moving assets. However, more investors are selling at a profit amid the downtrend, suggesting significant selling pressure despite the buying pressure.
The derivatives market has yet to pick up as the taker buy-sell ratio remains below 1. Nonetheless, long position holders are increasing as Bitcoin prepares for consolidation.
Key Levels to Watch
Vital Support: $80k, $76k
Vital Resistance: $82k, $86k
The chart shows the apex coin grappling with strong rejections around $80k. Nonetheless, the coin previously showed slight demand concentration at this price mark. A decisively flip offers a key support in the event of further declines.
Although the BTC rebounded at $78k, it is susceptible to further declines. Bearish fundamentals may send prices lower. Traders may stage buyback at the 61% fib level at $76k.
Conversely, the apex coin may look to return to critical levels. The $82k may be slow due to notable selling congestion around the mark. It may experience resistance at $86k in its bid at $88k.
