Bitcoin is currently facing a critical test, having retraced over 19% from local highs and holding above a key demand level around $54,000 that supports the market structure. This level represents the last line of defense for BTC, and if it breaks, a deeper correction could be in play. 

Analysts and investors are actively sharing their insights, with many looking at market data to assess Bitcoin’s next move. CryptoQuant CEO, Ki Young Ju, recently shared crucial data that sheds light on the current situation. His analysis highlights on-chain metrics that provide a clearer understanding of why Bitcoin is struggling to maintain its value. 

Additionally, he has made a prediction for Bitcoin’s performance in the final months of the year, outlining what investors should watch for as market conditions evolve. As the year progresses, these insights could help guide market participants as they navigate the volatility surrounding Bitcoin’s price action.

US Demand Crucial For Bitcoin Bull Run

Bitcoin (BTC) is currently experiencing significant selling pressure, largely attributed to a notable decline in demand. Recent data shared by Ju, reveals that Coinbase’s Bitcoin spot trading volume dominance has reverted to pre-spot ETF levels. This shift highlights a substantial dip in US demand, a crucial factor for sustaining the bullish momentum seen earlier this year.

Ju emphasizes that for Bitcoin’s bull cycle to regain its strength, a rebound in US demand is essential. He projects that this recovery might occur in the fourth quarter of 2024, suggesting that we are currently in the midst of the market cycle without having reached the retail bubble phase. This perspective implies that there remains ample opportunity for growth as the market progresses.

The current phase reflects a consolidation period rather than a terminal decline, indicating that Bitcoin’s price dynamics are subject to fluctuations as demand trends shift. Investors should be aware that while short-term pressure is evident, the potential for a significant rebound exists if demand conditions improve as anticipated. As the market continues to evolve, keeping an eye on these demand metrics will be crucial for understanding Bitcoin’s future trajectory.

BTC Technical Details 

Bitcoin is currently trading at $54,404, maintaining a critical support level that is keeping its price within a reasonable accumulation pattern. This level is crucial for preventing further declines. If BTC fails to hold this support, a deeper correction could be on the horizon.

At present, BTC is trading below the 4-hour 200 moving average (MA), which stands at $59,263. Reclaiming and holding this level as support is essential for shifting market sentiment and reviving bullish momentum. A decisive break above $60,000 would likely spark renewed demand and potentially drive the price higher.

Conversely, if Bitcoin loses its current support and falls below $54,404, it could signal a move towards lower demand zones, with $49,000 emerging as a key target for further testing. This scenario would indicate a bearish shift in the market, necessitating close monitoring of price movements to gauge future trends. The ability to hold above the $54,404 level and reclaim the 200 MA will be critical for determining BTC’s short-term outlook and potential for recovery.

Featured image from Dall-E, chart from TradingView