Bitcoin (BTC) Price Analysis: Importance of $46,400 Level
A cryptocurrency analyst known as @AxelAdlerJr on X (formerly Twitter) has raised concerns that if Bitcoin (BTC) drops below $46,400, it could push the leading cryptocurrency below its average purchase price over the last 12 months, making it unprofitable for new buyers.
The Bitcoin (BTC) community is advised to monitor closely the $46,400 level per coin, which represents the average buying price of the digital asset in the previous year. This insight was shared by CryptoQuant’s community analyst @AxelAdlerJr with his X followers.
Interestingly, this price level aligns with the peak of the local rally in mid-January 2024, driven by the long-awaited approval of a spot Bitcoin ETF in the United States.
The analyst has cautioned followers that a drop below $46,400 could trigger panic in the market. It is crucial for bullish investors to observe whether significant holders will seize the opportunity to buy the dip.
Despite this warning, the analyst believes that buyers still have a long way to go before exhaustion sets in. Notably, major players have allocated a substantial amount in U.S. Dollar Tether (USDT) across different blockchain networks.
In a previous report, the analyst highlighted the influx of fresh capital in the first quarter of 2024, which was anticipated to initiate the next bullish phase for Bitcoin’s price.
On a different note, Charles Edwards, the creator of the $100,000 “Energy Value Model” for Bitcoin’s price and founder of Capriole Investments, suggested that Bitcoin (BTC) could potentially dip below the annual average purchase price in a standard market move.
According to Edwards, a drop to $45,000 would be considered a normal pullback in a bull market, with corrections of 30-40% being typical. In the larger context, Bitcoin’s price cycles typically experience multiple pullbacks of 35-45% each, with the correction deemed healthy as long as BTC remains above $43,920.
As of the latest update, Bitcoin has managed to recover some of its losses, recording a 2.52% increase overnight. The price of Bitcoin has stabilized above $56,700 on major cryptocurrency exchanges.
