Here’s Key Reason Behind Recent Bitcoin Correction

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As a seasoned crypto investor with a decade of experience under my belt, I find the recent analysis by Negentropic (Jan Happel and Yann Allemann) particularly insightful. The fact that long-term holders have been more reluctant to cash out this time around indicates a stronger commitment to Bitcoin’s potential, which could indeed signal a local bottom.

According to the individuals known as Negentropic (Jan Happel and Yann Allemann), it was the action of investors cashing out their long-term investments that significantly contributed to the recent decline in Bitcoin‘s price.

This past week, the most valued cryptocurrency in terms of market size dropped as low as $90,000 but later recouped some of its recent declines.

Following its recovery, Bitcoin’s current value is being traded at around $95,719, marking a 1.5% rise in price over the last day.

Significantly, the creators of Glasnode pointed out that the profit-taking action among long-term holders of the foremost cryptocurrency showed a less intense approach when compared to the first quarter of 2024.

It’s clear that fewer long-term investors chose to sell their Bitcoins, even though the price almost reached the highly anticipated $100,000 mark earlier in the week.

Based on the pattern of long-term Bitcoin owners, it appears that Bitcoin may have possibly reached a temporary low point in its current market cycle.

In simpler terms, the duo stated that since there haven’t been consistent significant increases in profits over time, it appears that long-term holders may not have been selling during this downturn – which could mean that the lowest point may have already been reached.

Is Bitcoin losing its dominance? 

During the latest market recovery, altcoins like Ethereum have significantly surpassed Bitcoin in performance, leading to significant increases in their ratio against Bitcoin (ETH/BTC).

On the other hand, the Glassnode co-founders are convinced that the dominant position of the crypto market leader remains unchallenged for now.

In their latest update, it was stated that Bitcoin’s influence has slightly diminished, though it still holds the top spot. To definitively show a change, there needs to be a significant drop below the Daily Simple Moving Average 20 – a crucial indicator for the bullish momentum.

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2024-11-28 18:41