Bitcoin’s (BTC) active supply — coins that have moved in the past two years or earlier — dropped to a five-month low of 44.5% on June 2, according to data from Glassnode. This indicates that investors who had purchased Bitcoin more than two years ago are not keen to sell after the 40% drop.
Even miners, who sold during the May correction have since reversed their decision. The outflows from miner addresses are at the lowest level in seven months, which suggests that miners are holding on to their Bitcoin.
Veteran trader Peter Brandt believes that Bitcoin’s correction could extend below $30,000. Brandt said that every 50% fall in Bitcoin’s history has stretched to 70%. He also highlighted that according to past precedence, Bitcoin is unlikely to hit a new all-time high within seven months of a 50% correction.
However, PlanB, creator of the stock-to-flow-based Bitcoin price models, believes a further sharp fall below $30,000 is unlikely. He also remains positive on the prospects of Bitcoin hitting a new all-time high this year.
At the moment, analysts are divided in their opinion on Bitcoin’s short-term price action. Let’s analyze the charts of the top-10 cryptocurrencies to determine the path of least resistance.
Bitcoin continues to trade inside a symmetrical triangle pattern as the bulls and the bears battle it out to establish their supremacy. Although the symmetrical triangle generally acts as a continuation pattern, it is difficult to predict with certainty until the price breaks out of the triangle.
The downsloping moving averages and the relative strength index in the negative territory suggest that bears have the upper hand. If the BTC/USDT pair breaks below the triangle, the bearish momentum could pick up. There is a minor support at $28,000 but if that also cracks, the pair could retest the $20,000 level.
This negative view will invalidate if the bulls push and sustain the price above the resistance line of the triangle. If that happens, it will suggest that bulls have overpowered the bears. The pair could then attempt a rally to the 50-day simple moving average ($49,201).
This level may again act as a stiff resistance but if the bulls propel the price above it, the pair will signal that the downtrend could be over.
Author: Cointelegraph By Rakesh Upadhyay
This post originally appeared on Cointelegraph.com News