• Market sentiment was bearish over the last four months as BTC faced consistent rejections from local highs
• Selling pressure has not abated and could force another major southbound move

Bitcoin’s [BTC] 2024 halving occurred on 19 April. Since then, however, the promised bull run is yet to materialize. At press time, the Crypto Fear and Greed Index had a reading of 46 – A sign of neutral sentiment.

On the weekly chart, Bitcoin continues to present a bearish structure, with BTC setting lower highs and lower lows since late May. Insights into stablecoin flows reinforced the bearish view of the crypto-market over the coming weeks.

Suspicions of a deeper price correction

In a CryptoQuant Insights post, popular analyst theKriptolik noted that there has been a big decline in the inflows of Tether [USDT] to exchanges. AMBCrypto looked closely at the charts and found that the stablecoin exchange inflows were at a six-month low.

When Bitcoin and the wider crypto market experience a large price drop, stablecoin inflows tend to ramp up by a large amount. This is indicative of buyers using the dip to add to their crypto holdings.

The most recent, sharp price drop occurred on 5 August when Bitcoin fell from $58.3k to $49k – A 15.9% drop. On that day, the stablecoin inflows stood at $2.9 billion.

Therefore, the fact that we saw unremarkable Tether exchange inflows when BTC fell below $60k can be interpreted as alarming news. It implied that smart money was waiting for a much deeper price drop before entering the market.

How low can the next move go?

AMBCrypto’s analysis of the liquidation heatmap revealed that the next significant magnetic zones for Bitcoin would be at $48.8k and $46.6k. Also, there seemed to be a pocket of liquidity at $53.6k. These levels would be the targets for BTC in case of a price drop below $56k.

Read Bitcoin’s [BTC] Price Prediction 2024-25

A recent report warned that a plunge below $56k could lead to a much deeper correction. The bull-bear market cycle showed bearish dominance, and the findings from the Tether exchange flows reinforced this bearish view.