Bitcoin (BTC) has significantly dipped below the crucial $90,000 psychological mark, now sitting at a six-month low of less than $81,000. According to analyst CryptoOnchain, this downturn indicates a fresh corrective phase for the cryptocurrency, suggesting that the key area to watch is the $70,000-$73,000 support zone, which is anticipated to become the next battleground for market activities.

A Market Undergoes Correction

The drop has been severe, with Bitcoin losing approximately 17% in value over the last month and over 6% in just the last 24 hours, as indicated by data from CoinGecko. This recent price action has triggered substantial market liquidations. The selling pressure intensified due to maneuvers by long-term holders. Analytics firm Arkham noted that an early Bitcoin adopter, Owen Gunden, transferred $230 million worth of BTC to the Kraken exchange.

This was part of an extensive sell-off in which this entity sold off 11,000 BTC valued at $1.3 billion since October, creating increased pressure from an entity that had been inactive for years.

Despite this breach being technically bearish, CryptoOnchain observed that a new trading range appears to be forming between $70,000 and $90,000. They highlighted a Point of Control (POC) near $83,000, which could attract price consolidation.

The Path to a Potential Bottom

CryptoOnchain pinpointed the $70,000-$73,000 range as crucial. This area is not only a vital technical point but is also reinforced by on-chain data, suggesting it aligns with the average acquisition cost, or Realized Price, of significant Bitcoin holders. Insights reveal that these entities, holding between 100 and 1,000 BTC, have an average cost basis of approximately $71,000. History has shown that when the market price approaches the average purchase price of major investor groups, it often leads to buying pressure that can create a robust support level.

Market sentiment reflects ongoing fear as expressed by analytics platform Santiment, showcasing a mix of optimistic tones from those eager to buy the dip and pessimism from those anticipating further declines. The firm added that a true market bottom may establish when retail sentiment turns overwhelmingly negative, coinciding with a rise in price predictions dipping below $70,000.