Bitcoin experienced a very volatile trading session yesterday, with prices fluctuating between $92,300 and $96,420 throughout the day. The cryptocurrency is now hovering near the $93,000 mark, trying to establish a clear direction in the near term. As market participants await decisive action, there is uncertainty as to whether Bitcoin will maintain its bullish structure or face a deeper correction.
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CryptoQuant analyst Axel Adler recently shared some valuable insights that highlight a significant trend among short-term (STH) holders. According to Adler, these investors continue to sell their coins at high margins and capitalize on Bitcoin's recent upward momentum. While profit-taking is a natural part of market cycles, the lack of consistent demand to absorb this selling pressure could challenge Bitcoin's price stability.
If demand cannot match the pace of active profit makingA local correction may occur, potentially leading to a fall in the price of Bitcoin. This delicate balance between profit-taking and market demand makes the coming days critical to determining Bitcoin's next move. Will buyers step in to support the price or will selling pressure lead to a deeper pullback? Investors and analysts are closely watching Bitcoin pass through this important moment.
Responding to Bitcoin demand levels
Bitcoin has seen extreme volatility for days as it struggles to break through the $100,000 psychological barrier while holding steady above the $92,000 support. The market is still in a state of volatility, and investors and analysts are closely watching Bitcoin's next move. Despite the uncertainty, Bitcoin's resilience at these key levels highlights the ongoing struggle between bullish and bearish forces.
Top analyst Axel Adler Recently shared an insightful analysis of Xsheds light on the behavior of short-term holders (STHs). According to Adler, STHs are actively selling their coins at high margins and taking advantage of the recent price increase. While profit-taking is a normal part of market cycles, the lack of consistent demand to counter this selling pressure could lead to a local correction and potential price decline.
However, it is unlikely that STHs will continue to sell their holdings if the price declines, as selling at a loss in a bull market is often considered an unwise move. This dynamic could give Bitcoin the breathing room it needs to consolidate at its key support levels, currently around $90,000.
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If Bitcoin successfully holds above $90,000, a period of consolidation at this level could lay the foundation for the next rally, potentially pushing Bitcoin to new record highs. The coming days will be crucial to determine whether Bitcoin continues its ascent or faces a temporary setback.
Keeping Bitcoin above $90,000
After enduring days of selling pressure and market uncertainty, Bitcoin is trading at $93,800. Despite holding above the key support at $92,000, the loss of the 200 4-hour moving average (MA) and the exponential moving average (EMA) is a short-term bearish signal. These indicators, which are often regarded as measures of market movement, suggest that Bitcoin may need more demand to regain upward traction.
For the bulls to regain control and trigger a new rally, Bitcoin must recover these critical levels. The 4-hour 200 MA at $96,500 and the 4-hour 200 EMA at $98,500 are key barriers. Successfully raising these thresholds and securing a decisive close beyond them would confirm a renewed bullish move.
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If Bitcoin achieves this, it could set the stage for a massive increase in price discovery, breaking psychological barriers like $100,000 and paving the way for new highs. On the other hand, a failure to recover these indicators may indicate long-term consolidation or a possible retest of low support levels.
Featured image from Dall-E, chart from TradingView
