Bitcoin shows fragility amid $64K baseline
Bitcoin’s positive price actions continued as the asset maintained the $64K line amid moderate excitement. Historical on-chain data indicates that high bitcoin (BTC) demand frequently precedes price recoveries and rallies, but this is not the case.
Since the growth in BTC demand has remained modest, current market dynamics indicate that such bullish movements are unlikely soon.
A recent report from CryptoQuant highlighted that since early April, when the cryptocurrency asset was trading at around $70,000, Bitcoin’s demand has dramatically decreased.
This is demonstrated by the sluggish daily increase in Bitcoin’s value and the decreasing growth in large investor holdings.
Bitcoin’s 30-day Apparent Demand growth has decreased from 496,000 BTC in early April to 25,000 BTC recently. April’s increase was also the biggest since January 2021, and prices started to fall toward $50K as demand decreased.
Whales, or large Bitcoin holders with addresses holding 1,000–10,000 BTC, have seen a sharp decline in the growth of their overall holdings. The 30-day change in whale holdings was reported to have been 6 percent in February—the fastest rate since February 2019—but it has since dropped to 1 percent.
According to CryptoQuant, a monthly growth rate of more than 3 percent is required for bitcoin whale holdings to trigger a bullish momentum. Bitcoin traded at around $64.1K at the time of writing. It was only able to surpass $64,000 in August. 23 for the first time in the previous 20 days, and it failed to maintain above before retreating to $63,500.
The breakthrough was brought about by remarks made by US Federal Reserve Chair Jerome Powell, which gave investors more hope that interest rate cuts are in the works. He did not, however, provide a precise timeframe.
A crucial support level for Bitcoin in the months that followed the spot Bitcoin exchange-traded funds (ETF)’s approval in January was once thought to be $64K, but a recent decline in August. 5, referred to as “Crypto Black Monday,” saw Bitcoin reach new support near the $50K price mark
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