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Analysts warn that the Bitcoin price drop is “inevitable and necessary.”

Analysts warn that the Bitcoin price drop is “inevitable and necessary.”

The price of Bitcoin (BTC) has skyrocketed in the first few days of the week, breaking above $50,000 for the first time since December 2021. Bitcoin has been battling resistance around $52,000 since Wednesday and according to analysts at Swissblock, we may be preparing for a bearish trend.

Necessary Bitcoin correction

On Wednesday, the price of Bitcoin rose more than 4 percent to around $52,000. A day later, a short-term high of around $52,800 was reached, after which a decline brought the price back below $51,000.

The price soon rose back up to just under $52,000, where it was consolidating at the time of writing.

The $52,000 resistance zone has managed to prevent a further increase for now. Swissblock analysts warned of an impending correction in a market update seen by CoinDesk last Friday.

“With the recent rapid rise of around 33% in recent weeks indicating an unsustainable rally, a pullback appears to be inevitable and necessary,” the analysts wrote.

However, they talk about a healthy “near-term decline” that could provide investors with a good buying opportunity. According to Swissblock, as long as Bitcoin can maintain its support at around $47,500, higher prices can be expected.

At the time of writing, BTC price is at $51,740, more than 7 percent higher than at the start of the week.

Record inflows from BTC ETFs

The main reason for Bitcoin’s recent price explosion is the crushing influx of Bitcoin spot exchange-traded funds (ETFs) that hit US stock markets last month.

Last week, all funds combined raised nearly $2.3 billion in new capital. These net inflows exceed any other ETF on the market. It was also the most successful week since launching on January 11th. The average daily net inflow last week was about $454 million.

By far the largest share went into the fund of BlackRock, the world’s largest asset manager. With a net inflow of around $1.7 billion, BlackRock now owns more than $6.2 billion in Bitcoins.

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