Bitcoin’s Struggle: Selling Pressure from Coinbase and Miner Capitulation Intensify

• Bitcoin faces renewed selling pressure as the price drops below $65,000, accompanied by over $140 million in liquidations.
• Ongoing price action and key technical indicators suggest a downturn, with Bitcoin struggling to remain above significant support levels.
• Coinbase is a critical factor in the selling pressure, evidenced by the significant Coinbase Premium Gap.

Bitcoin Faces Renewed Downward Pressure Amid Significant Liquidations

Bitcoin Price Struggles Below Critical Support Levels

Bitcoin recently saw its price plummet below $65,000, driven by a massive wave of sell-offs amounting to over $140 million in liquidations. The leading cryptocurrency’s difficulty in sustaining its value above crucial support levels is evidenced by its recent break below the 50-day Exponential Moving Average (EMA) and a sharp approach to the 100-day EMA. Furthermore, the Relative Strength Index (RSI) illustrates increasing bearish momentum, raising concerns among market participants.

Coinbase’s Role in the Selling Pressure

A significant factor in Bitcoin’s recent downturn is the activity on Coinbase. The Coinbase Premium Gap, which compares Bitcoin’s price on Coinbase Pro to other exchanges, has turned markedly negative. This negative gap indicates that institutional investors on Coinbase are offloading substantial amounts of Bitcoin, contributing to heightened selling pressure.

Extended Miner Capitulation Impacting Bitcoin

According to Willy Woo’s analysis, Bitcoin is amidst an unprecedented period of miner capitulation. The Bitcoin Hash Ribbons, which identify stress and recovery periods for miners, reveal that many are struggling to stay afloat. The decline in mining activity and sell-off by weaker miners to cover operational costs is adding to the already significant selling pressure. Historically, Bitcoin prices tend to recover once the hash rate resumes an upward trajectory, suggesting a potential future rebound.

Decline in Large USD Transactions and Bearish Sentiment

In addition to the selling pressure from Coinbase and miners, a notable reduction in large USD transactions indicates that major investors are either scaling back or liquidating their holdings. The Bears and Bulls indicator also points to a prevailing bearish sentiment, as the number of bearish addresses significantly overshadows the bullish ones. This widening gap between buying and selling interest further highlights the market’s current bearish outlook.

Conclusion

The compounded selling pressure from institutional investors on Coinbase, prolonged miner capitulation, and the diminished activity of large transactions paint a grim picture for Bitcoin in the near term. While historical data suggests a potential recovery once weakened miners exit and the hash rate improves, market participants should remain cautious amid ongoing volatility and bearish trends. This multi-faceted scenario underscores the importance of closely monitoring different market levers to navigate the turbulent crypto landscape effectively.