The markets experienced a brief surge on September 27th as equity markets pulled out of the September 26th pullback, driving the price of bitcoin (BTC) back towards long-term downtrend resistance, which is currently at $20,100.
Unfortunately for the bulls, the positive momentum in stocks and cryptocurrencies quickly faded. Bitcoin price pared most of the gains made during the day, falling back below $19,000.
As has been the case since March 25, BTC price failed to break the above resistance for more than a few hours, and the September 27 break at the trendline continues the trend of consecutive bearish flags that see continue down.
According to Arcane Research, bitcoin’s skimpy rally above $20,000 is relatively insignificant since futures premiums remain low and “does little to improve market risk appetite.” .
Additional data from Arcane Research shows that funding rates have moved to neutral for the first time since September 13th. But in general, traders are reluctant to add long positions, given concerns about macroeconomic challenges and the continued threat of unfavorable cryptocurrency regulation.
A glimmer of hope
As mentioned in the previous analysis, despite the breakdowns and crises, BTC has been trading in the same range of $24,300 to $17,600 for the past 103 days. So far, no catalyst has yet been found to trigger a break below the lows, push the price above the resistance, and declare the first hurdle as support.
Fortunately, not everything is bleak for bitcoin. Positive news comes from chain analysis provider Glassnode, who noted that more mature investors have decided to dig in, and hold their positions rather than selling at the current price.
According to the reactivated supply metric for more than a year, an indicator that tracks “the total amount of BTC that returns to circulation after being undisturbed for at least a year”, the latent supply flow that returns to the supply pool active than “extremely weak”.
The mature spending compression seen in the later stages of the 2018 bull market is not present in the latest retracements below $20,000. Which suggests that long-term holders are well accustomed to volatility and willing to sell at current prices.
Given that BTC is 72% down from its all-time high, and some investors are expecting prices to fall towards $10,000 in the next unexpected selloff, a lack of panic selling by mature investors.
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