The largest cryptocurrency Bitcoin (BTC) has recently consolidated at around $51,000 following a sideways trend. After rallying towards $52,000 at the end of January, it experienced its first negative weekly close in about four weeks and is currently trading at around $51,500 with a market value of $1.011 trillion. While there was an expectation of a potential rally until Bitcoin‘s block reward halving event in March, JPMorgan analysts suggested that the halving might already be priced in.
Significant Supply Zones for Bitcoin
Closely followed crypto analyst Ali Martinez stated that BTC is currently trading within two key supply zones that could determine its short-term trajectory. According to him, the first significant support zone is between $50,000 and $51,570, where approximately 1.3 million wallet addresses hold 670,220 BTC.
On the other hand, the second zone, serving as a tough resistance area, is between $51,640 and $53,200, where 752,600 wallet addresses collectively hold 351,600 BTC. Martinez also noted that, according to Coinglass data, a jump to $52,250 could trigger a significant liquidation of $76.38 million.
The analyst suggested that a decisive break above the resistance zone could clear the path to a rise towards $57,130, but warned that failing to hold above the support zone could lead to a correction towards $47,700.
Expectations of a Drop to $40,000 After Block Reward Halving
Despite the current optimism, some market analysts suggest that the rise in Bitcoin’s price may be limited in the short term and advise caution. Experienced analyst Michael van de Poppe predicted that the ongoing rally could peak between $54,000 and $58,000, followed by a significant correction to the $40,000 to $42,000 range after the block reward halving.
Furthermore, there are concerns among market analysts about a potential major correction on Wall Street this year. Bitcoin maximalist Max Keiser recently compared the situation to a correction similar to that of 1987 and expressed his belief that Bitcoin would serve as a safe-haven asset during such periods.
