Bitcoin is feeling the effects of the ongoing global tariff disputes, leading to minimal upward movement. The cryptocurrency seems to have halted its bull run, which has lowered investor hopes for a quick rebound.
With Bitcoin currently trading just above $77,000, it has fallen nearly 30% from its all-time high, including a 1.6% decrease in the past 24 hours. Amid this situation, recent insights from CryptoQuant contributor Onchained indicate that Bitcoin may be approaching a critical point that could influence the asset’s future direction.
Focus on Bitcoin Realized Price Levels
Onchained’s recent analysis highlights the alignment of Bitcoin’s spot price with its 2-Year Realized Price. This indicator, derived from on-chain data, calculates the average acquisition cost of coins that have been transacted on the blockchain in the last two years.
This price range often acts as a significant support level, particularly during transitional phases between bear and bull markets. Historically, Bitcoin sustaining its price above the 2-Year Realized Price indicates underlying strength among long-term holders.
Onchained pointed out that BTC has remained above this line since October 2023, demonstrating continued investor confidence. If Bitcoin can maintain this level, it might signify the formation of a new value floor, potentially paving the way for renewed buying interest.
The analysis also suggests that a rebound from this support area could be seen as an influx of capital from investors viewing this price as a key accumulation point. Conversely, falling below the 2-Year Realized Price could spark a deeper correction or an extended period of consolidation.
Increased Market Volatility from Long Liquidations
In another update, CryptoQuant analyst Darkfost noted a significant event that rattled the derivatives market. On April 6, the largest Bitcoin long liquidation event of the current bull market took place, resulting in the loss of approximately 7,500 BTC in long positions.
This liquidation event represented the highest daily volume of forced long position closures since the bull market commenced. Darkfost attributes this incident largely to increasing volatility and uncertainty stemming from concerns about U.S. economic policy.
In particular, anxieties about new tariffs under the Trump administration have exerted pressure on global markets, including the crypto sector. The analyst cautioned that such liquidation scenarios highlight the risks associated with holding high-leverage positions during volatile macroeconomic circumstances. Darkfost remarked:
This serves as a strong reminder to remain vigilant during times of heightened volatility like the present. It is crucial to prioritize the safeguarding of your capital.
Featured image created with DALL-E, Chart from TradingView
