Key Points
- Bitcoin (BTC) hit a new all-time high of $69,324 before sharply dropping 9.75% to $59,323 on March 5.
- Market analysts suggest this drop could lead to a “healthy consolidation” and warn against fear of missing out (FOMO).
On March 5, shortly after the opening bell on Wall Street, Bitcoin (BTC) reached a new all-time high of $69,324. Bitcoin then experienced a sharp correction of 9.75% to $59,323.
Bitcoin’s FOMO Stage
Data from Markets Pro and TradingView showed Bitcoin trading 9% below its new all-time high of $69,170. Despite the flash crash, Bitcoin is still up 12% over the last seven days. Market analyst Aksel Kibar noted that Bitcoin reached above $69,000, a stage he referred to as the “FOMO stage”.
On March 4, Kibar observed Bitcoin trading within the $65,000 and $68,000 ranges, moving towards the November 2021 peak of around $69,000. He cautioned investors against getting caught up in the fear of missing out at that level.
Alex Thorn, Head of Research at Galaxy Research, focused on Bitcoin’s historical price action, especially in 2020 when it briefly retraced after hitting new all-time highs. Thorn suggested that if history repeats itself, Bitcoin is likely to drop “11.3% lower over 15 days before definitively breaking ATH” again in the coming weeks.
Potential Retracement and Sell Signal
The mid to low $50,000s is seen as a possible retracement where a dip could occur. On March 2, Peter Brandt shared a chart showing Bitcoin trading in a wide ascending parallel channel with short-term support below $55,000 provided by the pattern’s middle boundary.
Independent analyst Ali observed that the TD Sequential indicator sent a sell signal on the daily chart, warning traders to pay “close attention” shortly before the price crash. This indicator has a strong track record in predicting Bitcoin trends since the start of the year.
While some traders expected a deeper correction in a pre-halving retrace, technical price analyst John Bollinger termed the retrace on March 5 in Bitcoin price “a bit much.” He added that a failed rally attempt would be ugly.
Market data showed traders were poorly positioned for the latest run above $69,000. Over $1.17 billion leveraged positions were liquidated across the crypto market in the last 24 hours – $846 million of these being long liquidations. Bitcoin long liquidations totaled $236.33 million.
