Bitcoin Price May Drop Below $60,000 Due to Heavy Profit Taking

Bitcoin MVRV Ratio. Source: Santiment

Another critical indicator, the short-term Net Unrealized Profit/Loss (NUPL), suggests that short-term holders are experiencing massive unrealized profits. This group of investors, known for holding assets for less than a month, is typically quick to sell once profits accumulate. The NUPL shows that the bullish momentum has reached a level where short-term holders are likely to start selling, increasing the risk of a price drop.

Short-term holders (STH) are expected to begin liquidating their positions as the bullish sentiment fades above the current threshold. Historically, when STH are in profit and above the threshold, they sell off their assets, putting downward pressure on Bitcoin’s price. This makes a potential decline in price highly likely if this trend continues.

Bitcoin STH-NUPL. Source: Glassnode

BTC Price Prediction: Fall Ahead

Bitcoin’s recent rise of 19% has brought its price to $64,342, with $63,068 now acting as crucial support. This level has established itself as a key area where Bitcoin could find stability if selling pressure increases. However, despite the recent gains, a breach of the $65,000 resistance level seems unlikely in the near term.

If profit-taking intensifies, Bitcoin could drop below the $63,068 support, potentially falling to $59,666, the next critical support level. This price floor may serve as a point for Bitcoin to bounce back if selling pressure weakens. However, failure to hold this support could lead to further declines.