Bitcoin (BTC) price faces increased volatility, dipping below $75,000 twice in a week

Recent fluctuations in the Bitcoin market have drawn significant attention as the cryptocurrency dipped below the $75,000 threshold on two occasions within the past week. Following an all-time high of $109,000 on January 20, 2023, Bitcoin's recent movements have positioned it within what analytics firm Glassnode refers to as an 'air pocket'—a price range between $70,000 and $80,000 characterized by a rapid ascent following President Donald Trump's election victory in November. Historically, Bitcoin rallies that lack essential price retests tend to lead to volatile reactions, and the current scenario adheres to this trend. Key indicators, such as the Unspent Transaction Output (UTXO) Realized Price Distribution (URPD), illustrate that less than 2% of the total Bitcoin supply exists in this region, hinting at heightened volatility due to limited available supply. Moreover, a concerning statistic reveals that approximately 25% of Bitcoin's circulating supply is currently held at a loss, primarily among short-term traders who entered the market within the previous 155 days. This situation speaks to the stress faced by newer investors amid tumultuous market conditions. Following the market behaviors seen in equities, particularly amidst a deepening US-China trade war impacting sentiment, traders may view Bitcoin's fluctuations as symptomatic of broader economic concerns. Notably, the recent valuation of $78,300 at the April 9 Wall Street open indicates rapid market adjustments—suggesting investor anxiety and strategic retreats among traders. Market analysts, including trader Keith Alan, have indicated a wait-and-see approach, with many expressing reluctance to make further trades in a turbulent environment. Additionally, the recent trading data from the CME Bitcoin futures market highlighted a crucial resistance level, suggesting established market ranges that could guide future fluctuations. In sum, traders should brace for a potential storm as the Bitcoin price may test lower boundaries to establish a clearer trend.