Bitcoin
Is Bitcoin at risk? This group could cause the price of BTC to fall
- Rising market inflation indicated that BTC holders were selling some of their assets.
- The data showed that the price could rise to $72,000 before a major correction.
If the signals AMBCrypto obtained from Glassnode’s on-chain data are anything to go by, Bitcoin [BTC] could be set for a significant price reduction.
Leading this forecast is the LTH market inflation rate. LTH stands for Long Term Holders in the Market.
The LTH market inflation rate uses the level of accumulation or distribution to determine Bitcoin’s next direction.
However, there are two lines on this chart as shown below. Green represents the market inflation rate, while brown indicates the nominal inflation rate.
An investor’s belief does not equate to their actions
In bull cycles, if market inflation falls below headline inflation, it indicates that long-term holders are accumulating. As such, this could lead to a price increase for Bitcoin.
On the other hand, the market inflation rate ascending above the nominal rate suggests that holders are significantly increasing selling pressure.
Hence, BTC could be on the verge of a notable crash. Until now, the metric formed the last standard.
Source: Glassnode
Bitcoin has changed hands at $69,164 at press time, representing a 2.98% increase over the past seven days.
But before concluding that holders can push BTC to the downside, AMBCrypto analyzed the sentiment that holders have about the coin.
To do this, we analyze LTH-NUPL. This metric is an acronym for Long-Term Holder – Net Unrealized Profit/Loss. This way, you can get an idea of the behavior of long-term holders.
As of this writing, LTH-NUPL is in the belief zone (green). This indicates that holders, who have held the currency for at least 155 days, are trusting this in the potential of Bitcoin.
Source: Glassnode
However, this may not be in the short term as the same set of people may contribute to the distribution of BTC.
In terms of price prediction, the settlement heatmap provided information about currency movement.
$72K, then $63K
Settlement Heatmap Helps merchants to find the best liquidity positions. If liquidity is concentrated in one area, prices may move in that direction. However, highly liquid areas can also be resistance or support areas.
Using data from Hyblock, AMBCrypto identified a magnetic zone at $72,350, indicating that Bitcoin price could move towards this region.
However, the same zone could act as resistance for the coin. If BTC rises to the price mentioned above and is rejected, it could spell doom for the cryptocurrency.
This is because the other major area of high liquidity was at $63,050.
Source: Hyblock
Is your portfolio green? Check out the BTC Profit Calculator
Following the indications above, the price of Bitcoin could increase. But when the correction appears, it may be difficult for the currency to recover.
If the coin loses its grip on $63,050, the next drop could send BTC to $56,200. However, if this does not happen, Bitcoin could jump to $70,000 once again.