Glassnode asserts that the $88,000 price point is the key level to watch for Bitcoin investors seeking to gauge the asset’s momentum.
After running to new price highs of around $108,000 in early December 2024, Bitcoin‘s momentum has been largely subdued in recent weeks amid macroeconomic headwinds. Most recently, this saw the asset’s price drop nearly 11% from about $102,700 to as low as $91,200 before rebounding to trade near $95,000 at the time of writing.
Amid the uncertainty, a prominent crypto analytics platform has identified a key level for investors to watch to gauge the asset’s trajectory.
Glassnode Points to $88K
Glassnode has asserted that the $88,000 price point is the key level to watch for Bitcoin investors seeking to gauge momentum. The firm disclosed this in an X post on Thursday, January 9, highlighting that it represented the cost basis of short-term holders.
The metric is important as short-term holders tend to sell as the market price approaches their cost basis, also known as realized price.
Glassnode notes that such a reaction could trigger a significant price decline as Bitcoin does not appear to have considerable price support immediately below this level. The firm arrived at this conclusion using the UTXO Realized Price Distribution, which shows the prices at which market participants last moved coins.
According to the chart, below $88,000, Bitcoin’s next significant support could be around the $73,000 price point, citing volumes last moved at that price.
Glassnode’s view received significant support from prominent crypto analyst Ali Martinez, who described the price range as “free fall territory.”
Potential Volatility Ahead
While the would-be catalyst for such a price drop is presently unclear, Glassnode’s insights come ahead of the release of key U.S. economic data on Friday, January 10, including the Non-Farm Employment Change and Unemployment Rate.
These data releases could lead to significant market volatility if they come in weaker or stronger than economists have predicted, as they could impact the Federal Reserve’s interest rate considerations.
Interestingly, veteran trader Peter Brandt has suggested in recent weeks that a deeper Bitcoin correction, specifically below the $89,000 level, may be necessary before it can rally to new highs. At the same time, he has highlighted that the asset could be forming a head-and-shoulders pattern on the daily candle chart with a target around $73,000.