2020-8-20 13:56 |
Bitcoin (BTC) price has corrected lower to trade below $12,000 again but it will most likely avoid reliving the Black Thursday as the amount of BTC owned at exchanges has hit 2020 low, according to the on-chain data.
Fundamental analysis: Push higher likely?Crypto community raised concerns yesterday that another crypto market collapse like the Black Thursday would happen again after the world’s largest digital coin lost some ground on Tuesday and Wednesday.
CryptoQuant, a crypto analytics data platform reported that BTC reserves are at the lowest point this year.
“People keep worrying about the great sell-off like March, but exchanges don’t have as many idle Bitcoins (waiting to be sold) as that day,” said Ki Young Ju, Chief Executive of CryptoQuant.
When the amount of BTC reserves held at exchanges hits a low, it usually indicates that investors have withdrawn their reserves from the crypto exchange and placed it into more permanent storage.
Data from another market data platform, Chainalysis, also shows that the amount of Bitcoin held for 52 weeks is moving up. Glassnode made a similar observation recently and reported that “the decline of Bitcoin exchange balances signals reduced selling pressure.”
At the moment, around 2.6 million BTC are kept at crypto exchanges, a figure lower than the one before the massive sell-off in March when the number of stored Bitcoin was 2.9 million.
CryptoQuant on-chain data also suggested that BTC miners are preferring to retain their Bitcoin supply right now. This is most likely an indication that miners are anticipating higher prices as well as a sign of positive sentiment given that miners have a certain influence over the price of Bitcoin.
Another indication of bullish sentiment is that Bitcoin hash rate has been on the rise too, which means that more investors consider the cryptocurrency price reliable.
Technical analysis: Bitcoin correction lower as dollar surgesBitcoin (BTC/USD) price has corrected lower in the last two days, falling from around $12,500 to $11,570 yesterday. Two factors are likely to have contributed to this fall: 1) A technical correction after hitting a 1-year high at $12,473, and 2) A strong dollar rally which took place last night.
Bitcoin price weekly chart (Trading View)Bitcoin price corrected after tagging the 127.2% Fibonacci extension line that sits at $12,330, adding further importance to this technical indicator. If another bullish run is staged then the BTC buyers will most likely target a move to 161.8% Fibonacci extension that sits at $14,640.
SummaryBitcoin price has corrected lower in the past two days as the number of Bitcoin held at crypto exchanges is at the lowest point in 2020, meaning that the repeat of Black Thursday is now unlikely.
The post Bitcoin (BTC) price corrects lower after hitting short-term target appeared first on Invezz.
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