Bitcoin News Today: Bitcoin May See Two Final Rallies Before Market Correction

Bitcoin is expected to experience two more significant price rallies before entering a potential correction phase, according to a recent analysis by Axel Adler Jr., a prominent analyst at CryptoQuant. Adler's prediction is based on on-chain data and evolving investor behavior, which together suggest that the market is nearing the final stages of the current bull cycle [1]. The analyst points to a key on-chain metric that surpassed 1.9 in March and December 2024 but is now forming a lower peak. This pattern is interpreted as a sign that more long-term holders are selling their Bitcoin, thereby increasing downward pressure on prices [1].

According to Adler, this behavior reflects a gradual shift from accumulation to distribution, where investors are increasingly focused on securing profits rather than holding for further gains. As the bull run matures, investor risk appetite weakens, and the market becomes more cautious. The analyst notes that each subsequent price surge yields diminishing returns, indicating a decline in market efficiency [1]. This dynamic leads to a growing supply-demand imbalance, where the amount of Bitcoin being sold starts to outpace the demand from new buyers—another precursor to a potential correction.

External macroeconomic factors are also influencing the market outlook. Adler highlights the anticipated interest rate cuts by the U.S. Federal Reserve as a key development that could support the upcoming rallies. Historically, lower interest rates have made riskier assets like Bitcoin more attractive to investors, as capital flows into higher-yielding opportunities. However, the analyst cautions that the timing and perception of these rate cuts will be critical. If seen as a response to weakening economic conditions, the impact on the market may not be as straightforward. In this context, the rate cuts could provide a temporary boost by increasing liquidity and investor confidence but may also coincide with a broader economic slowdown [1].

For investors, the prediction offers both opportunity and caution. Two potential rallies present short-term trading possibilities, but the looming correction underscores the need for disciplined strategies. Adler recommends that investors prioritize risk management by setting clear profit targets and stop-loss levels. Portfolio diversification is also emphasized as a way to mitigate risks during a downturn. Staying informed about market developments and maintaining emotional discipline are crucial, as market predictions can trigger strong emotional responses [1].

The cyclical nature of the Bitcoin market remains a central theme in Adler’s analysis. While the allure of further price increases is evident, the possibility of a correction serves as a reminder to approach the market with prudence and a well-defined strategy. The evolving interplay between supply and demand, investor sentiment, and macroeconomic factors continues to shape the trajectory of Bitcoin’s price. Investors are advised to remain adaptable and informed, as the market moves through its phases [1].

Source:

[1] Bitcoin Price Prediction: Unveiling Crucial Rallies Before Market Correction (https://coinmarketcap.com/community/articles/68906851f66ec432fbcd0283/)