Bitcoin (BTC) investors should read this before making an investment decision
Bitcoin has recorded a sluggish performance this week, with the cryptocurrency's 7-day chart mostly painted red. The aforementioned drop has sparked some speculation in the market about what will happen next. As always, the opinion of the crypto community is very diverse.
While some believe a trend reversal is possible in the coming days, some reports suggest the opposite. At the time of writing, Bitcoin is trading at $20,010, having dropped more than 5% in just the past 7 days. It also has a market capitalization of over $384 billion. & Nbsp; & nbsp;
Bear play & nbsp;
Recently, Dan Lim, an analyst writing for CryptoQuant, pointed out in his analysis that the possibility of Bitcoin falling further is very high due to a number of international reasons. In doing so, Lim highlighted a number of bearish market conditions that could contribute to the same. & Nbsp;
According to the analyst,
“When a bear market starts, most people keep buying without realizing that it is a bear market. But if the bear market lasts for a long time, most people get tired of it and stop buying.”
The prediction seems correct, as a number of indicators have supported the possibility that the Bitcoin price will continue to fall. For example, Bitcoin supply in profit hit this month's low on August 28th after moving south since mid-August.
Furthermore, Rate MVRV also fell, indicating a bear market. This may just be a good opportunity for investors to buy in. & Nbsp;
Recently, Bitcoin withdrawals from exchanges have also decreased significantly, indicating a similar bearish trend.
Easy OnChain, another CryptoQuant author, mentioned that this development suggests that the price level has not been considered for long-term accumulation. This could be a sign that the Bitcoin price will continue to fall in the coming weeks.
As the previous trend has shown, this could be a good opportunity for investors who are looking for long-term profits.
A look at the 4-hour chart of BTC has confirmed that bears dominate the market, as the majority of the candlesticks are red. Bollinger Bands suggest that the price of BTC is in a high volatility zone. These can soon lead to a price decline, thereby minimizing the chances of a short-term rally.
Although the above mentioned indicators, analysis and charts forecast bearish market conditions, several indicators highlight the possibility of a minor trend reversal.
According to the MACD, the blue line is approaching the red line, which could lead to a bullish crossover in the coming days. In addition, the total number of Bitcoin addresses with non-zero balances shows steady growth over the months. This, despite its price performance - An indication of investors' confidence in this coin. & Nbsp;
Aug 29, 2022