Bitcoin Selloff Seen as Profit-Taking, Not Sentiment Shift

Dogecoin led sharp losses for the broader cryptocurrency market Tuesday as Bitcoin retreated from its recent record $123,000 high. Following Monday’s rally, significant profit-taking pushed Bitcoin down towards $117,000 and caused widespread declines among top digital assets.

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Bitcoin Selloff Seen as Profit-Taking, Not Sentiment Shift The Dip: Key Developments Post-Correction Outlook

Market analysis suggests this correction, while notable, does not signify a lasting change in sentiment. Analysts describe it as a "classic breakout-pullback sequence," emphasizing that Bitcoin’s long-term structure remains bullish. Supporting this view is a concurrent spike in trading volume, indicating continued market participation.

The current selloff coincides with a brutal liquidation event, totaling approximately $463.1 million, with roughly $385 million affecting bullish positions.

The Dip: Key Developments

Dogecoin (DOGE) plunged 7%.
Ethereum (ETH) dipped more than 2%.
XRP fell over 2.9%.
Solana (SOL) dropped more than 4%.
Bitcoin corrected sharply, falling nearly 4%.

The widespread nature of the correction saw almost all major altcoins decline, with Dogecoin experiencing the largest drop. BTC briefly traded below $116,300, hitting liquidation levels identified by analysts.

Post-Correction Outlook

Analysts surveyed maintain a cautiously optimistic outlook:

Young (MEXC Chief Analyst) expects short-term consolidation but identifies supportive levels and reinforcing bullish market signals. He anticipates BTC potentially near $110,000 before a possible renewed push above the $123,000 mark.
Howard (Wincent Director) highlights mean reversion after a significant price move, expecting profit-taking to push BTC further. He also advises readiness for the next "altcoin season" focused on institutional-grade assets.
Søndergaard (Nansen Analyst) notes the traditional correlation where Bitcoin dips lead to deeper altcoin declines. He points towards established support levels and anticipates outcomes on upcoming CPI data will vary depending on source material.

Despite the temporary setback, market indicators like prediction markets (Myriad) show sustained confidence in Bitcoin’s long-term trajectory above $100,000.