Bitcoin’s price has yet to break out of the large descending channel and move toward a new record high, but a further rally is highly probable.
Still, BTC failed to overcome the psychological $70,000 line earlier this week decisively.
Technical Analysis
By TradingRage
The Daily Chart
On the daily chart, the asset has been rallying recently since a rebound from the lower boundary of the descending channel and the $60K support level.
Yet, the higher trendline of the channel has rejected the cryptocurrency, and the $68K support zone is currently being tested. If the level holds, it will only be a matter of time before bitcoin creates a new all-time high. On the other hand, a breakdown could cause a correction toward the $60K support level once again.
The 4-Hour Chart
Looking at the 4-hour chart, the price is currency hovering around the $68K level, failing to keep its upward momentum. The Relative Strength Index also oscillates around the 50% threshold, indicating that the market is still indecisive.
Meanwhile, the first target for a deeper correction could be the midline of the large channel, followed by the $60K support zone. However, a drop below these levels could be catastrophic, as the market might crash aggressively due to a liquidation cascade.
On-Chain Analysis
By TradingRage
Bitcoin Exchange Inflow – Spent Output Age Bands
While bitcoin’s price is seemingly losing its bullish momentum once again, analyzing the behavior of investors could be very beneficial. This chart demonstrates the Spent Output Age Bands of exchange inflows. Simply, it shows the fraction of deposits made by investors who have held their coins for a certain timeframe.
Looking at the age band of over 6 months, considered long-term investors, there is no sign of aggressive selling pressure. In fact, long-term holders only realize profits as they would in any bullish trend, slow and steady.
Interestingly, the Spent Outbut Age Band for long-term holders has decreased even more than that of lower prices, indicating that long-term holders expect higher prices to offload their holdings. The resulting supply shrink can lead to a further price increase if sufficient demand comes in.
