Bitcoin [BTC] has seen a tremendous rally over the past week, with its price surging above $68,000. However, a bearish divergence on its price chart suggests a potential price correction, which could see the cryptocurrency dip back to $66,000 or even lower to $62,800.

Bitcoin’s Bullish Run and Key Strengths

Bitcoin’s price appreciated by over 9% last week, according to CoinMarketCap. Several key factors have contributed to this rally:

• Exchange Supply: Bitcoin’s supply on exchanges dropped to a 5-year low, indicating strong buying sentiment.
• Open Interest: Bitcoin’s Open Interest surged to $20 billion, just 8% below its all-time high.
• Institutional Inflows: Over $2.1 billion flowed into Bitcoin ETFs in just five days, reflecting growing institutional interest.

Satoshi Club, a popular crypto analyst, highlighted that the supply of Bitcoin held by addresses buying in the last 12 months has reached a 2-year high. This shows growing confidence in Bitcoin from both new and institutional investors.

Bearish Divergence Signals Possible Correction

Despite the bullish momentum, a bearish divergence has appeared on Bitcoin’s chart, suggesting a short-term price correction. According to respected analyst Ali, this divergence could pull Bitcoin down to $66,000, or in a more extreme scenario, to $62,800.

On-chain metrics provide further support for this potential correction:

• Binary CDD: Long-term holders have not been moving their coins significantly in the last 7 days, indicating strong confidence in Bitcoin’s future.
• aSORP: More investors are selling at a profit, which can indicate a market top.
• NULP: Investors are in a phase of high unrealized profits, which could lead to increased selling pressure.

What’s Next for Bitcoin?

If a correction occurs, Bitcoin could find support at $66,000. If selling pressure increases, a deeper decline to $62,800 is possible. However, long-term fundamentals remain strong, with institutional adoption continuing to grow.