Bitcoin Price Risks Plunging To $37,500 As Crypto Market Bleeds, Time To Sell BTC?

Investors are deliberating where the crypto market is heading after the tables turned towards the end of last week. Following the Federal Reserve’s announcement of three intended rate cuts in 2024 while leaving interest rates unchanged, Bitcoin price climbed above $43,000.

A correction ensued soon after this move as the hurdle at $44,000 did not budge, increasing confidence among sellers. Altcoins also trimmed gains, extending the bearish wave.

Bitcoin price can barely hold above $41,000 at the time of writing, on Monday during US business hours, accentuating the bearish theory. If this support caves in, BTC would be at the risk of falling below $40,000 and testing support at $37,500.

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Bitcoin Price Prediction: What’s Next After BTC Lost Key Supply Zone

Bitcoin price is on the verge of sliding below $40,000 and extending the decline to $37,000 based on on-chain data analysis conducted by Ali, a crypto analyst and posted on X.

Based on the blockchain data processed by IntoTheBlock, Bitcoin is trading below a key supply area, running from $41,200 to $42,400. Approximately 1.87 million addresses have in the past accumulated 730,000 BTC in the range.

More losses are expected now that Bitcoin is holding below this supply zone, as traders aim to cut losses.

“If selling pressure increases, watch for a possible decline to the next demand zone between $37,500 and $38,700. Here, 1.28 million addresses are holding 553,000 BTC,” Ali shared via X.

#Bitcoin has slipped below a key supply zone, ranging from $41,200 to $42,400. In this area, 1.87 million addresses had accumulated 730,000 $BTC.

This downturn might trigger these holders to sell, aiming to cut losses.

If selling pressure increases, watch for a possible decline… pic.twitter.com/aTX1RWarkb

— Ali (@ali_charts) December 18, 2023

Now that Bitcoin is finding buoyancy at $41,000, holders are torn between keeping their positions open or cutting losses. The Relative Strength Index (RSI) concurs with the latter notion—to cut losses and aim to buy after BTC rebounds from a lower support area.

The RSI, although with a falling strength at 35, is not oversold yet. Hence, the possibility of Bitcoin sliding below 40,000.

Besides, trading below the 20 Exponential Moving Average (EMA) (in blue), and the 50 EMA (in red) reinforces the bearish grip.

Traders should be on the lookout for certain key factors, starting with a possible rebound from the grey zone toward the red zone on the chart. On the other hand, massive declines could engulf BTC if support in the grey band weakens.

The 200 EMA (purple) currently at $39,970 is in line to absorb the overhead pressure, but if selling activities increase, the drop to $37,500 would materialize.

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