Bitcoin Has Solid On-Chain Cushion Below $68,900: Stage Set For Fresh Rally?
03 Junho 2024 - 8:00PM
NEWSBTC
On-chain data shows Bitcoin could have significant support between
$66,900 and $68,900, which may help provide solid ground for a
fresh surge to higher levels. A Large Amount Of Investors Bought
Their Bitcoin Between $66,900 & $68,900 According to data from
the market intelligence platform IntoTheBlock, BTC is currently
floating above a major demand zone. In on-chain analysis, the
strength of any support or resistance level is based on how much
“demand” was present at it. Related Reading: Bitcoin ‘Realized
Volatility’ Showing Very Rare Trend: What Could Be Next Below is a
chart that shows the various Bitcoin price ranges near the current
spot value and how they compare in terms of the total amount of the
asset the investors purchased. Here, the size of the dot correlates
to the total number of tokens that were last acquired at the
corresponding price range. It would appear that, out of these
zones, the levels between $66,900 and $68,900 currently host the
cost basis of the greatest amount of BTC. More than two million
addresses have acquired 1.1 million BTC inside this range. Since
the current BTC spot price is above these levels, all investors who
buy there will make slight profits. Investor cost basis is
important in the on-chain analysis because the level has special
psychological significance. A potential retest of it can result in
a flip of the profit-loss balance for the holder. As such,
investors may be prone to making some moves when a retest like this
takes place. A holder carrying losses before the retest (that is,
the retest is happening from below) may be tempted to sell for fear
that the price will go down in the future. On the other hand, an
investor in the green before the retest may have reason to believe
the price would go up again and, thus, could decide to accumulate
more. When retests of price ranges thick with investors, one of
these reactions may arise on a scale that could be relevant for the
wider market, therefore, major demand zones below can act as
support points, while those above can act as resistance blocks.
Related Reading: Crypto Analyst Says Bitcoin Will Rise To $79,600
If This Holds Bitcoin has a large support range of $66,900 to
$68,900 right now, which could help cushion any falls should the
asset’s price decrease. From the chart, it’s also apparent that, at
the same time, the Bitcoin ranges ahead are thin with holders. This
could, in theory, provide the ideal conditions for a rally towards
higher levels. BTC Price Bitcoin surged past the $70,000 level
earlier in the day, but the asset has since retraced to $69,100.
Featured image from Dall-E, IntoTheBlock.com, chart from
TradingView.com
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