As a seasoned crypto investor with a keen eye for market trends and technical analysis, I find the recent selling pressure on Bitcoin concerning. The fact that it dropped below $65,000 and more than $140 million in liquidations was just the tip of the iceberg.
The demand to sell Bitcoin has reached a peak once more, causing it to dip beneath the $65,000 mark. Approximately $140 million in trades were terminated as a result. Yet, the primary cause behind this selling frenzy might not be immediately apparent.
The current trend in Bitcoin’s price suggests it’s struggling to stay above significant support points. A fall beneath the 50 Exponential Moving Average (EMA) and a move towards the 100 EMA on the daily chart depict a steep downturn. Additionally, the Relative Strength Index (RSI) indicates increasing bearishness.
It’s important to note that Coinbase is driving down the Bitcoin price right now. The Coinbase Premium Gap, which compares Bitcoin’s price on Coinbase Pro with that on other exchanges, is showing a substantial difference in the opposite direction, implying that large-scale institutional investors are actively selling off their Bitcoins through Coinbase.
According to Willy Woo’s analysis, the prolonged miner surrender is evident in the current situation based on the Bitcoin Hash Ribbons. These ribbons signify periods of tension and revival among miners, and we are currently witnessing an unprecedented level of miner capitulation. However, as history suggests, when the mining hash rate recovers and less productive miners exit the market, Bitcoin typically experiences a rebound.
In a comparable manner, the number of large US dollar transactions has significantly dropped, implying that prominent market participants may be reducing their positions or offloading their holdings. The Bulls and Bears indicator, which represents a predominance of bearish wallets, further underscores this bearish trend. It seems that there are more sellers than buyers in the market as the difference between bullish and bearish wallets has grown larger.
Based on the available data, it appears that there are various reasons for the observed selling activity. Notably, Coinbase is a significant contributor due to the large volume of Bitcoin transactions taking place on its platform. Additionally, miners are offloading their Bitcoin holdings to cover operational costs during this prolonged period of miner distress, thereby exacerbating the downward pressure on prices.
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2024-06-21 17:48