Bitcoin is finally here broken below the $60,000 support The world’s largest digital asset has been in a downtrend for two months. The largest digital asset in the world has been largely in a euphoria phase The price of Bitcoin has been steadily rising since the beginning this year and especially following the introduction of Spot Bitcoin Exchange Traded Funds (ETFs) in the US. The current price consolidation for Bitcoin is a sign that the euphoria might be fading.
Glassnode is a firm that provides on-chain analysis. According to their latest report, it appears as though the excitement surrounding Bitcoin has begun to fade. Bitcoin’s price was active over the last 6.5 months. Meanwhile, BTC has moved into a fear zone where investors have shifted their focus to selling.
Selling Pressure Rises
Bitcoin, which reached an all time high in March of 2024 at over $73,737 USD, has fallen by 18%. Investors are taking their profits. A rise in the number of addresses with losses has accompanied this drop, which indicates an increased amount of selling pressure. The number of addresses that are making profits has increased. fallen in tandem From over 99% down to 86% as of the date this was written.
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Glassnode, a platform for on-chain analysis, noted this in its latest report. report The consolidation is underway. According to the Net Unrealized Profit & Loss (NUPL) metric, Bitcoin has been in a euphoria mode very early in this cycle when compared to past cycles. The NUPL was above 0.5 about 6.5 months prior to the recent halving of Spot Bitcoins amid hype over Spot ETFs.
It is compared to the market cycle of 2021, when the NUPL entered a profit area 8.5 month after Bitcoin’s halving. The market has been in a euphoric phase over the past seven months, but it is now cooling off. due to correction The last two months have been particularly busy.
The report also noted that the occurrence of a “distinct uptick in net outflows” This is a reflection of the mood among traders. It means that traders across all wallet sizes are under pressure to sell. A majority of the short-term holders (one week up to a month) has been reporting losses since March on the 90 day +1sd.
Glassnode
What does this mean for Bitcoin?
Then, “fear” While a drop in price after such an abrupt rise may concern investors, most analysts believe that a pullback is healthy. Most long-term investors are still holding strong The halving is still not complete. Bitcoin was trading for $59,899 at the time this article is written and has fallen by 5.35% over the last 24 hours.
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The current cost-basis of the short-term holders is $66,700. Their realized price, however, is $59,800. This means that many more members in this cohort may be entering the “loss zone”.
The crypto analyst Ali Martinez believes that a $59800 investment is worth it. key price level History has shown that Bitcoin is likely to rise above the STH price.
Source:| Source: BTCUSD on Tradingview.com
Featured Image from CryptoSlate. Chart by Tradingview.com
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