As a seasoned researcher with years of experience in the volatile world of cryptocurrencies, I find myself intrigued by the recent market fluctuations of Bitcoin. The rollercoaster ride this week, with BTC soaring to new heights only to plunge again, is nothing short of exhilarating.
So far this week, the cryptocurrency market has experienced two drastic shifts in pricing. Bitcoin reached a record peak of over $108,000, only to plummet down to approximately $95,587.68. This week also witnessed significant buying sprees by leading Bitcoin-supporting companies. However, despite this pattern, Bitcoin’s price has continued to decline, and Samson Mow has weighed in on the current situation.
Bitcoin supply shock coming
On platform X, Samson Mow commented that he frequently encounters questions about why the value of Bitcoin keeps decreasing even though it’s being widely purchased and there’s no excess supply. In his explanation, he suggested that the current market behavior is simply an example of irrationality due to the limited availability of Bitcoin.
It’s common to wonder why the price of Bitcoin decreases even when demand is high and supply is scarce. This phenomenon can be attributed to market behavior that sometimes seems illogical, given the scarcity of available coins. Trust your gut feeling; a significant drop in supply could be on the horizon.
— Samson Mow (@Excellion) December 20, 2024
This week, MicroStrategy acquired an additional $1.5 billion in Bitcoin, bringing their total to 439,000 BTC. Similarly, smaller companies such as MARA Holdings have also purchased significant amounts of Bitcoin, reducing the available amount in circulation.
Despite all the recent acquisitions, the market hasn’t surpassed the $108,000 threshold; instead, it’s struggled to hold its ground above the $100,000 support level.
As a researcher, I myself find Samson Mow’s assertion intriguing. He suggests that investors should rely on their intuition and grasp the impending event he terms as a “supply shock.
Imminent BTC price recovery
Whenever MicroStrategy discloses a Bitcoin acquisition, as they’ve done for the past six weeks, the market adjusts its pricing to average out their purchase price. Although it’s not clear if they will reveal another purchase next week, the market is likely to make adjustments in anticipation of any potential announcement about further buying.
Currently, Bitcoin’s price has decreased by 3.54% in the last day, reaching $95,243.24. Given the persistent downtrend, it appears that Bitcoin may undergo a significant retest at this level due to its strong support formed around this price range over the past month.
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2024-12-20 14:16