Veteran dealer Peter Brandt has cautioned conscious of “worry of lacking out” (FOMO) buying and selling in the present Bitcoin (BTC) market, warning the market has not but in a bull run based mostly on the congestion happening.
“Bitcoin will not be in a bull market that began at Feb low. Rather, BTC is in a broad congestion zone commencing at Feb highs. FOMO buying and selling in congestion zones may be an costly interest.”
Since the start of this yr, Bitcoin has skilled each notable highs and lows. For occasion, the main cryptocurrency set a new report value of $64,800 in mid-April.
Nevertheless, a month later, BTC lost greater than 50% of its worth in a single day to hit lows of $30K. As a outcome, this value drop turned the primary time Bitcoin dropped beneath the 200-day shifting common (MA) since March 2020 because the coronavirus (Covid-19) continued wreaking havoc.
The 200-day MA is a key technical indicator used to find out the final market development. It is a line that reveals the typical closing value for the final 200 days or roughly 40 weeks of buying and selling.
Bitcoin lately gained momentum and breached the psychological value of $50K, nevertheless it skilled a correction that has made the value hover across the $45-$46K space.
BTC was down by 14% in the final seven days to hit $45,305 throughout intraday buying and selling, in accordance with CoinMarketCap.
Is the congestion being brought on by long-term and short-term holders?
According to Glassnode, long-term and short-term Bitcoin holders have been taking opposite strikes. The crypto analytic agency noted:
“The relative provide held by LTH and STH tells us an fascinating story about Bitcoin: 1. Over 16.8% of the BTC provide was spent in the final 5mths and returned to revenue on the latest $52.8k excessive. 2. Long-term holders now personal 79.5% of the BTC provide, equal to Oct 2020.”
Therefore, long-term holders have been shopping for whereas their short-term counterparts have been promoting. Many cash modified arms through the latest consolidation in the $29-$40K vary.
Furthermore, Bitcoin purchased between the primary and second quarter of this yr remained tightly held, on condition that long-term buyers remained unshaken by the 50% drawdown skilled in May.
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