Bitcoin's Price Plunge: A $72,000 Correction Looms

Bitcoin's price faces a potential correction to $72,000 as investor sentiment weakens, with the cryptocurrency experiencing a significant drop from its record high in January. Analysts predict a brief correction to the $72,000 support level, as the market repositions itself following a lack of crypto investor sentiment, which has reached lows not seen since 2022.

Bitcoin (BTC) price hit an over three-month low of $78,197 on Feb. 28, falling over 28% from its record high of over $109,000 reached on Jan. 20. Iliya Kalchev, dispatch analyst at digital asset investment platform Nexo, believes that Bitcoin may experience a deeper retracement toward the “low $70,000’s range as the market repositions.” However, he also noted that a “significant drop below $75,000 seems less likely,” and that Bitcoin is more likely to establish firm support in the $72,000 to $80,000 range, which could provide a foundation for a more sustainable recovery.

Other analysts also predicted a Bitcoin bottom near $70,000 in early 2025 before the next stage of the rally. Based on its correlation with the global liquidity index, Bitcoin’s right-hand side (RHS), which marks the lowest bid price someone is willing to sell the currency for, may fall below $70,000 around the end of February after it peaked near $110,000 in January. The first warning of a correction to $70,000 came from Raoul Pal, founder and CEO of Global Macro Investor, in November, when he also predicted that Bitcoin would reach a “local top” above $110,000 in January, before the current correction.

While analysts expect Bitcoin to find its bottom and start a recovery in the coming weeks, the crypto market remains limited by a lack of investor confidence. The Crypto Fear & Greed Index — which measures overall crypto market sentiment — fell to a near three-year low of 20, last seen in July 2022, Alternative.me data shows. The last time investor sentiment dropped to similar levels was a month after Bitcoin fell to $17,500