- While long-term holders (LTHs) of Bitcoin continue to accumulate despite a decrease in positive sentiment, short-term holders (STHs) have adopted a more risk-averse approach.
- Currently, BTC is trading at $29,296 with a weighted sentiment value of -0.421. This metric has remained below zero since the beginning of June.
- The price of BTC is resting in the lower region of the Bollinger Bands indicator, indicating that the cryptocurrency is experiencing overselling at its current price and may undergo an upward correction.
As short-term investors sell off their BTC, long-term investors continue to accumulate; will the Bitcoin price be able to recover?
Long-Term Investors Continue to Accumulate Bitcoin
Despite a decrease in positive sentiment, long-term holders (LTHs) of Bitcoin continue to accumulate, while short-term holders (STHs) of the leading cryptocurrency have adopted a more risk-averse approach. According to IntoTheBlock’s data, the amount of BTC held by this investor group during a 12-month period remained below the amount held during the 2021 bull market.
Historically, increases in the price of the leading cryptocurrency have been accompanied by an increase in the number of short-term holders. However, the recent price increase did not lead to an increase in the number of these investors. “Instead, the growth of long-term holders continues,” stated IntoTheBlock.
The on-chain data provider also noted that this contradicted the significant increase in short-term holders when BTC returned to $11,000 in 2019.
Currently, BTC is trading at $29,296 with a weighted sentiment value of -0.421. This metric has remained below zero since the beginning of June. Weak sentiment has caused the price to fluctuate between $29,000 and $32,000 since April.
With more traders exiting their positions and seeking security, BTC accumulation has decreased. Currently, key momentum indicators are resting below their respective centerlines. Currently, Bitcoin’s Relative Strength Index (RSI) is 45.43. The Money Flow Index (MFI) is in a deep oversold zone at 29.18.
The Chaikin Money Flow (CMF), which indicates an increase in liquidity outflow from the Bitcoin market, currently returns a negative value of -0.08.
Key Point to Note in Bitcoin…
While indicators suggest that BTC accumulation has lagged behind selling in the past few weeks, a closer look at the Bollinger Bands and Stochastic Oscillator indicators of the cryptocurrency reveals that it is in an oversold condition and the price may soon recover.
Bollinger Bands measure the price volatility and potential overbought or oversold conditions of an asset. Similarly, the Stochastic Oscillator indicator generates signals about overbought and oversold conditions by comparing the closing price of an asset with its price range over a specific period.
Currently, the BTC price is resting in the lower region of the Bollinger Bands indicator, indicating that the cryptocurrency is experiencing overselling at its current price and may undergo an upward correction. As for the Stochastic Oscillator, it is positioned in the oversold zone (below 20). This condition also supports the idea that the cryptocurrency’s price may recover.
