At a time when the balance of BTC has reached a critical threshold on the stock markets, the bitcoin struggling to stay above $20,000.
Forcible possession over $20,000
Bitcoin still managed to rally after breaking crucial support at $20,800 and holding above the $20,000 zone. This, almost during the week. Remember that last week, the asset tried to climb back up after suddenly falling 19th August. He managed to reach $21,800 before he fell again.
In the last 4 days, there has been a fluctuation between the price of bitcoin $19,500 and $20,500. This, despite the situation of the FED and the inflation that is currently spreading to Europe. For investors, this is a blow, especially since all indicators point to near-term weakness for bitcoin. In particular, they are looking for exit liquidity as soon as there is an opportunity.
Bitcoin is struggling to stay
In its latest weekly bulletin, Glassnode says that the performance of the BTC user base is lacking and the price action remains relatively weak despite the decrease in spending with the older coins. The report also mentions investors stuck in a losing streak. In fact, they record more than 220 million net loss per day. Although this sounds huge, it is nothing compared to the many multi-billion capitulations recorded in recent years.
However, the situation has improved compared to the multi-billion capitalists seen recently. The SOPR metric also tells us that the situation is not great. As a reminder, this data makes it possible to better determine the potential losses or profits on the coins spent. The SOPR is currently adjusted by a value of 1.0 after retesting it last week. We also find the same pattern in mid-August sales reports.
Test phase at 1.0
According to Glass snood, the recent selloff comes after a test run at 1.0 at a time when BTC price hit $24,000. The rejection of the level is explained by the fact that investors took the exit liquidity and tires worn based on the cost of acquisition.
The metric remained in the 0.60 to 0.65 area for several consecutive weeks. Also, long-term holders of BTC locked in losses from -35% to -40%. If we look at the loss peaks of -50% in 2018, we understand that long-term holders are happy to keep their coins expect the SOPR to show a move above 1.0. This may mean a rally in price.
Can bitcoin be recovered?
Despite falling prices, investors continue to withdraw their bitcoins from exchanges. According to Santiment, the total number of BTC stored on the exchanges has increased to 1.74Ma decrease of almost 40% since March 2020. He said that it is not new that the long-term owners are taking a larger percentage of the total supply held when the general market trend is down.
However, analysts fear that this phase will continue and the crypto market will be at its darkest period. It is also not certain that bitcoin can recover and record a sustainable rise. In fact, for this, all the signals must go green. To note that The current bitcoin price is $20,101 after increasing 0.71% in the last 24 hours.
More information: Bitcoin Could Have a Tough September – Here’s Why