Bitcoin’s network fundamentals have continued to explode this year. The price side of things, however, has been disappointing recently. With its stagnating since mid-March, concerns about possible downside targets stretching toward $20,000 have emerged.
Despite some encouraging signs in recent months, Bitcoin’s latest retreat dragged its price below $27,000.
Bitcoin’s Key Support Areas
As the world’s largest cryptocurrency remained trapped in a narrow range below $30k, Glassnode observed that the spot price remains in close proximity to three significant pricing levels, “providing robust support around the $25,300 – $26,300 region.” The levels in question are:
Short-Term Holder Cost-Basis: $26,000
Adjusted Realized Price: $25,300
200 WMA: $26,300
According to Glassnode’s analysis, sustained elevation above these crucial support areas can be deemed as a constructive sign. On the other hand, a drop in Bitcoin’s price beneath the key levels would infer a weakness in the trend.
The latest data surfaces after the crypto-analytic platform’s co-founder Negentropic hinted that the current tight-range consolidation could potentially be nearing an end, implying that BTC will soon hit its bottom and subsequently flip positive.
Moreover, the conviction among the existing BTC holders was found to be “remarkably high.” Such a trend can be counted as bullish, despite the crypto-asset’s slow growth this quarter. This is because such a trend potentially signifies that investors consider the current market condition to be an opportunity.
More recently, the exec stated that FOMC is likely to prove a major catalyst that will drive Bitcoin’s price.
“More chop is expected until ~1 week before FOMC. Keep a close eye on open interest to see how the market is positioning (there is any positioning) going into June 14.”
Transition Phase
Bitcoin appears to have reached a “transition,” which should set the stage for the next bull market top, according to Glassnode’s new research. The long-term investors of the premier crypto-asset are preparing for gains in the near term.
The company found that Bitcoin long-term holders (LTHs) – those hodling BTC for at least 155 days – have started a transition toward a state of “equilibrium” before reaching full “euphoria,” which typically means that this cohort is preparing for the next BTC price cycle top.
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