3 September 2024
Bitcoin traders are upbeat, expecting prices to shake off recent weakness and soar above the local resistances to as high as $73,800. Even so, before the coin breaks above these liquidation regions, buyers must have conviction. Moreover, the leg up must be sustained by a fresh influx of new capital, ideally from investors fearing they will miss the train.
Currently, Bitcoin is stable and moving inside last week’s bear range. At the same time, the coin is moving inside the September 1 bear candlestick that’s noticeably wide-ranging. Even though prices are higher at spot rates, finding support from the $56,500 and $57,000 support zone, some traders are not convinced.
Bitcoin Needs To Break $70,000 For The Uptrend To Continue
There are several reasons to be cautious. According to IntoTheBlock data, bulls need to be supported for the uptrend of Q1 2024 to continue. From their data, approximately seven million addresses bought BTC between $61,700 and $70,500.
At spot rates, the analytics platform notes that these addresses are at a loss. Therefore, whenever prices approaches their break even price, they are more likely to sell.
Their sustained selling pressure and motivation to be safe, IntoTheBlock data analysts said, prevents BTC from ripping higher, soaring to all-time highs. In light of this, and for Bitcoin to soar, bulls need to sustain the rally above $60,000.
Moreover, they need to decisively break $70,000, ideally with expanding volume. If anything, the level of engagement should exceed the trading volume posted on August 5. Then, prices slumped to as low as $49,000 in early August.
Over 30% Of All Supply In The Hands Of HODLers, Paper BTC Declining
While there is a likelihood that the nearly seven million addresses will dump BTC, a significant portion of BTC supply is in the hands of long-term holders (LTHs). LTHs are those addresses that have held BTC for at least 155 days. According to IntoTheBlock data, over 30% of the total supply has not been moved for over five years.
Meanwhile, another bullish factor that can support prices in the coming days is how the market has been absorbing supply from German authorities, the United States Department of Justice (DoJ), and Mt. Gox.
One on-chain analyst notes that the absorption is impressive. This development, coupled with declining “paper” BTC from derivative platforms like Binance, could support prices.