May 18, 2022

Bitcoin Price Analysis: Despite The Correction, Long-term Accumulation Indicator Just Flashed

3 min read

The past seven days had been a blast for Bitcoin, after skyrocketing to the top of the trading range in between $34K and $46K. However, it got greatly rejected, reaching the resistance zone in the middle of the $45K area, together with a rising trendline.

Technical Analysis

By: Shayan

Long-Term: The Daily Chart

Today, there is potential selling liquidity above the $46K area and substantial purchasing liquidity below the $35K location.

Additionally, there is an apparent divergence in between the rate and the RSI on the 1-hour timeframe, which has actually led to the correction we witness now.

The rate requires to form a higher low to continue the uptrend. Moreover, Bitcoin has broken above the multi-week descending trendline (significant purple on the following chart), then got turned down by the 100-day moving average line, and now is retesting it as support. If assistance holds, then another bullish leg may be seen.

Short-Term: The 4-Hour Chart On the 4H timeframe, two obvious imbalance areas lie in the $ 41.5 K – $ 42.8 K and $ 38.6 K – $ 40.6 K areas. Both may act as possible assistance. As lots of technical analysts may concur, the marketplace will generally correct those imbalances on events when cost increases dramatically. As a result, It can be anticipated that the market will see some volatility in the near term, with liquidity being soaked up in lower cost levels prior to a possible extension to the upside.

Onchain Analysis: Realized Cap– UTXO Age Bands By: Edris Over the previous 2 years, the most dominant belief of global affairs has actually been”unpredictability.”And there is one location that dislikes unpredictability more than anywhere else: Financial Markets.

From an international pandemic to inflation-related concerns and, recently, a geopolitical conflict – – all have actually been drivers for numerous unpredictable phases over the previous 2 years.

In these durations of uncertainty, it is often recommended to zoom out and observe the huge image. The following chart demonstrates, for example, a big picture of Bitcoin’s supply characteristics given that its first block.

This metric is called Realized Cap– UTXO Age Bands (%), and it visualizes different groups of coins based on their ages (the last time they were moved) and their share of the total realized cap. Here, coins aged from 3 months to more than 10 years are revealed and separated by various colors defined in the chart’s legend.

In summary, an increase in these age bands shows HODLing and accumulation (green), and a drop in them shows selling and circulation (red) by the mid-term to long-term holders.

The market is presently in an accumulation stage, with the variety of coins last moved more than three months ago increasing quickly. This type of habits by the holders is promising and signals that despite the short-term volatility, the continuation of Bitcoin’s bullish megatrend is somehow inevitable.

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