Prospects for Bitcoin surpassing $97K despite potential profit-taking action
Get Ready to Dive into the Crypto State of Play: Weak Demand, Hollow Outflows, and a Potential Correction Ahead
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After a period of high-octane crypto hype, it seems the Bitcoin [BTC] party might be windng down. On-chain activity, transaction volume, and active addresses have all nose-dived since December 2024, signaling a significant drop in demand. The Coinbase Premium Gap is currently sitting at a hefty -5.07, pointing to steady selling pressure from American traders, despite Bitcoin's impressive performance recently.
With Bitcoin trading at $94,446.17, down 0.28% in the past 24 hours, many are left questioning the $98K breakout potential. So, will BTC shatter resistance or are we looking at a deeper correction?
Is there a catch to exchange outflows without whale backing?
Large holder netflows have plummeted a staggering 90-day drop of -99.86%, showcasing a sudden cease-fire in whale accumulation, even as Bitcoin held steady above $94K. Although overall exchange outflows persist, the lack of buying from large entities raises doubts about strong institutional conviction. Historically, massive whale activity has preceded significant price jumps.
As it stands, Bitcoin sees net outflows amounting to -7.16K BTC, a 15.53% decrease. While retail and smaller holders may be moving coins off exchanges, the absence of substantial whales leaves question marks over whether the current exchange activity will translate into robust upward momentum without their reinforcement.
Are profit-rich holders keeling over and heading for the exit?
According to on-chain data, a staggering 82.09% of Bitcoin addresses are currently "in the money." This means most holders are sitting pretty with unrealized profits. As the market gets rocky, the urge to replenish their coffers may grow, limiting immediate upside until fresh capital steps in.
Adding fuel to the fire, the Net Realized Profit/Loss (NRPL) has surged by 21.88%, and Supply-Adjusted Coin Days Destroyed (CDD) has jumped by 13.19%. This indicates long-held coins are being exchanged, often a sign of profit-taking from long-term investors. So, as these signals suggest, spy-fi agents probably aren't the only ones looking to liquidate their assets when bankrupting the market becomes tempting.
Bitcoin faces challenges at $97.9K with mixed signals
Bitcoin is battling to break through the $97,914 resistance level, with multiple rejections observed in the charts. The Parabolic SAR dots remain suspiciously above the candles, signaling ongoing bearish influence, while the MACD is steadily flattening, indicating waning momentum. This technical setup for Bitcoin puts a question mark on its ability to sustain current levels without renewed buyer strength.
While it's a bummer to see on-chain demand dwindling, prices dropping, and resistance ensuring there's nowhere to hide, a little bit of downside isn't necessarily a bad thing. In fact, healthy corrective phases can help clear the market and provide a necessary breather for investors. So, keep your cool cowboys, and let's inch closer to that pleasant, post-correction Bitcoin buzz!
Bitcoin Market Eyeing Signs of Recovery or Resistance: Time to Stock Up on Popcorn and Patience
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After the turbulent crypto roller coaster, some much-needed peace and quiet has settled over Bitcoin, causing on-chain demand to taper off and active addresses to dwindle. Prices have slid 0.28% in the last 24 hours, with the digital asset trading at $94,446.17. The question on everyone's mind is whether the resistance will hold or collapse, giving way to the much-anticipated breakout.
The lack of whale buying power raises doubt about institutional conviction as large holder netflows plummet and Bitcoin refuses to budge above $94K. Interestingly, retail players and smaller holders are offloading their assets, but the absence of major institutional backing casts a shadow over the current exchange activity.
As 82.09% of Bitcoin addresses enjoy their profits, the desire to accumulate more fades, especially when the market remains uncertain. In such scenarios, investors are likely to sell off in anticipation of any downward pressure, exacerbating the decline. The Net Realized Profit/Loss (NRPL) has surged, and the Supply-Adjusted Coin Days Destroyed (CDD) has shot up, signaling increased profit-taking.
Regardless of the pessimistic outlook, Bitcoin is still facing resistance at $97.9K with mixed technical signals. Without strong buyer strength, the digital asset may struggle to maintain its current levels and could potentially revisit lower support zones. So, grab yourself a bag of popcorn, folks, and prepare for an exciting event to unfold!
- The current sell-off pressure from American traders as indicated by the Coinbase Premium Gap might hint at a future downturn for BTC, considering the drop in demand, on-chain activity, and transaction volume since December 2024.
- Institutional conviction could be questionable, as there's a lack of buying from large entities despite persisting exchange outflows, with whale accumulation showing a sudden halt.
- Profit-rich holders are potentially liquidating their assets, as 82.09% of Bitcoin addresses are currently in the money and the Net Realized Profit/Loss (NRPL) and Supply-Adjusted Coin Days Destroyed (CDD) have surged, signaling profit-taking from long-term investors.
- Bitcoin's ability to sustain its current levels could be in jeopardy, given the mixed technical signals such as multiple rejections at the $97,914 resistance level and the ongoing bearish influence from the Parabolic SAR.
- The absence of substantial whales and the dwindling on-chain demand could lead to a potential correction, but a healthy corrective phase can provide long-term benefits by clearing the market and offering an opportunity for fresh capital to flow in.
- Despite the challenging circumstances, a watchful eye should be kept on Bitcoin, as the market may soon reveal signs of recovery or resistance, making it an exciting time for patient investors who have some popcorn ready.
