Bitcoin's price faces pressure as Korean investors increase buying amid market dip. Analysis predicts possible support at $48,900.

Bitcoin’s price dropped to a weekly low of $50,600 on Feb. 23, down 5% in the past three days. However, a unique buying frenzy observed across Korean exchanges offers fresh insights into the market.

The cryptocurrency exchanges in South Korean markets have seen an increase in Bitcoin (BTC) trading this week. Historical patterns suggest that this could have a significant impact on Bitcoin’s short-term price movements.

Increased buying pressure from Korean investors

Following a strong 27% uptrend in the first half of February, Bitcoin’s price has struggled to maintain momentum this week. After reaching a yearly peak of $52,985 on Feb. 20, BTC price has now fallen 5% to a new weekly low of $50,600 at the time of writing on Feb. 23.

Earlier this week, crypto.news reported on South Korean political parties supporting pro-crypto policies favoring ETFs and delays on additional taxes. A unique buying trend has emerged among crypto investors in South Korean markets amidst the falling Bitcoin price.

However, historical trends suggest that this could further deepen Bitcoin’s ongoing price decline.

CryptoQuant’s Korean Premium (KP) Index tracks the price gap between South Korean exchanges and other exchanges. Rising values indicate increased buying activity among Korean investors and vice versa.

The KP index has surged 400% from 1.03 to 4.54 between Feb. 14 and Feb. 23, coinciding with Bitcoin’s ongoing price correction.

Historically, there has been a noticeable correlation between the BTC price and the Korean Premium Index. When the KP Index surges, indicating heightened buying activity among Korean investors, Bitcoin’s price often experiences downward pressure or negative correlation.

Bithumb, Upbit, Coinone, and Korbit are the leading crypto exchanges in South Korea, known as “The Big Four.” These platforms host 90% of all crypto assets held by the country’s residents, according to Seoulz.com research.

The long-term inverse relationship with BTC prices suggests that fluctuations in the Korean market can influence broader market sentiment and contribute to price volatility in the cryptocurrency ecosystem.

Bitcoin price forecast: Potential support at $48,900

If this unusual negative divergence between Bitcoin price and Korean market activity repeats, BTC could dip below $50,000. Additionally, with Bitcoin ETFs due to close trading for the week of Feb. 23, institutional demand for BTC is likely to decline further in the days ahead.

Capitalizing on these crucial factors, bears could attempt to force a rapid downward movement toward $45,000.

In this scenario, if Bitcoin loses the $50,000 support, it could trigger a freefall toward the 20-day SMA price of $48,942. Considering that the overall sentiment surrounding the crypto markets is still largely bullish, BTC bulls could create a consolidation buy-wall at that key support level.

On the flip side, Bitcoin could see a surge in demand from leveraged bullish investors looking to avoid margin calls at the $50,000 level. In this case, Bitcoin's price could experience an upswing toward the next significant resistance at the $55,500 area, as indicated by the upper Bollinger Band indicator.