Bitcoin Correction Triggers Market Reset: Liquidations, Accumulation, and Signs of Potential Macro Bottom
Bitcoin underwent a rapid correction, dropping nearly 10% and causing over $10 billion in derivatives liquidations as open interest fell sharply from its $80 billion peak. Despite the initial downturn, Bitcoin quickly rebounded by 5.2%, with on-chain data signaling strong investor confidence. Bitcoin’s Realized Cap soared to a record $935.1 billion, indicating sustained accumulation, while new address growth pointed to rising organic demand. The Fear & Greed Index fell to 46 (fear) but has since recovered to 55 (neutral/optimistic), suggesting improved market sentiment and risk appetite. Large withdrawals from exchanges—10,000 BTC at $104,700—signal ongoing strong holder accumulation. Analysts interpret the sell-off as a healthy market reset that has cleared speculative excess and established a firmer foundation for future price growth. Historically, similar deleveraging events have marked macro bottoms leading to sustained rallies. Traders should monitor on-chain activity and sentiment indicators, as the current price zone could represent the start of a new accumulation phase and medium-to-long-term bullish momentum if trends persist.
Bullish
The recent sharp correction in Bitcoin’s price led to significant liquidations and a reduction of leverage, typically seen as a market healthy reset. This hasn’t dented long-term investor confidence; instead, on-chain data such as the all-time high in Realized Cap and growth in new addresses suggests ongoing accumulation and sustained interest from both current and new participants. The swift recovery in both price and sentiment metrics (e.g., the Fear & Greed Index) further supports the view that the market has digested the volatility and is building a foundation for upward momentum. Exchange outflows indicate that major holders continue to accumulate, which historically precedes bullish trends. If these accumulation and sentiment improvements persist, Bitcoin could be entering a new macro accumulation phase and traders might see strengthening medium- to long-term bullish momentum.