- As Bitcoin
enthusiasts move towards new highs, the cryptocurrency has encountered a hurdle at the $28,000 level. After surpassing a consolidation period of $26,000, the digital asset is now facing a bearish turn.
- Interestingly, CryptoQuant data shows a sharp drop in Long-Term Holder SOPR (Realized Transaction Price). This metric has dropped from 1.56 to 0.72 when Bitcoin crossed above $28,000.
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Bitcoin enters a period of relief after a challenging consolidation phase; will BTC be able to regain $30,000?
Bitcoin Leaves Behind the Consolidation Phase
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As Bitcoin enthusiasts move towards new highs, the cryptocurrency has encountered a hurdle at the $28,000 level. After surpassing a consolidation period of $26,000, the digital asset is now facing a bearish turn. Additionally, Bitcoin saw an increase in accumulation just hours before Grayscale’s legal victory against the SEC. Now, it seems that investors are looking to capitalize on the gains generated by this rally and seek selling opportunities.
After Grayscale’s legal victory, which raised hopes for spot Bitcoin ETFs, the price of BTC rose from $26,000 to nearly $28,184. However, this bull run was short-lived as Bitcoin encountered resistance at higher levels, resulting in a 2% drop.
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According to Santiment data, wallet holders with balances between 10 and 10,000 BTC accumulated an impressive $388.3 million or 14,596 BTC just hours before the announcement. According to IntoTheBlock, the number of large transactions increased from 9.27K to 16.49K after BTC price crossed $27,000.
However, an increase in large transactions is not always a bullish indicator; in fact, it has contributed to bearish pressure on Bitcoin. Large holders who bought Bitcoin at lower prices may sell to profit from the recent rally, thus increasing selling pressure. Large sell-offs can reduce market liquidity and make it difficult for Bitcoin’s price to continue its upward trend.
Interestingly, CryptoQuant data shows a sharp drop in Long-Term Holder SOPR (Realized Transaction Price). This metric has dropped from 1.56 to 0.72 when Bitcoin crossed above $28,000. “Long-Term Holders” or LTHs refer to Bitcoin investors who hold their coins for at least 155 days before selling or transferring.
The recent drop indicates that these LTHs are becoming impatient and prefer to sell at current levels to minimize losses, as they initially bought Bitcoin at higher prices. This behavior signals a decrease in trust among holders and creates a bearish outlook for Bitcoin’s price.
What to Expect for BTC Price?
Bulls and bears are battling as the price of Bitcoin drops following a sell-off from the high level of $28,184. However, bulls are strongly defending a drop below $27,000 as it could trigger another round of profit-taking. At the time of writing, BTC is trading at $27,200, down more than 2.2% in the past 24 hours.
Indicators such as increasing moving averages and overbought levels suggest that bulls currently have the advantage. However, bears are expected to put up a strong defense at the $28,700 resistance level, making it difficult for bulls to sustain the upward trend.
If the price bounces back from the $26,800 level, it could trigger another bull run and attempt to break the resistance level. Breaking above $28,700 indicates renewed strength and the potential to push the price above $30,000.