Bitcoin’s price has been experiencing a decline recently, with lower highs and lows and breaking through various support levels. This downward trend has left investors puzzled, especially after positive reports on US inflation.
According to TradingRage’s technical analysis, on the daily chart, Bitcoin’s price has been on a downward trend since being rejected at the $70K level. It has also broken below the 200-day moving average, currently around $58K, and is hovering around $57K. The 200-day moving average has been acting as resistance, suggesting a possible drop to $52K in the near future.
Looking at the 4-hour chart, the rejection from the long-term bearish trendline indicates a potential drop to $52K if the $57K support level is breached. A further downtrend could be expected if the RSI falls below 50%, unless the trendline is broken to the upside.
In addition to technical analysis, it is essential to consider on-chain analysis to understand the reasons behind the recent downtrend. By analyzing the behavior of Bitcoin miners, insights can be gained into the market sentiment. The Bitcoin miner reserve metric, which measures the amount of BTC miners hold in their wallets, has been decreasing rapidly in recent months. This decrease suggests that miners may be selling more Bitcoin than they are mining, signaling a bearish outlook and potentially leading to further price declines.
As the market continues to fluctuate, it is important for investors to stay informed and conduct their own research before making any investment decisions. Cryptocurrency investments come with risks, and it is crucial to understand the market dynamics and trends before diving in. Stay updated with the latest news and analysis to navigate the volatile cryptocurrency market effectively.