Key Points
- Market indicators suggest a potential price correction for Bitcoin in the coming days.
- Despite a recent price correction, buying pressure on Bitcoin remains high.
Bitcoin [BTC] has experienced a price correction after a significant rise. A recent report also indicates further price correction could be on the horizon.
Bitcoin’s Performance
Bitcoin’s bullish momentum appears to have slowed. As per CoinMarketCap, the cryptocurrency’s price rose over 8% in the past week. However, the trend shifted in the last 24 hours with only marginal price movement. At the time of writing, Bitcoin was trading at $68,423.71 with a market capitalization exceeding $1.35 trillion.
Crypto analyst Ali recently tweeted about a significant development regarding Bitcoin’s key indicator, the TD sequential, which signaled a potential sell-off. This suggests that investors may start selling Bitcoin, which often leads to a price decline.
Is a Correction Imminent?
Analysis of Glassnode’s data reveals an increase in Bitcoin buying, with BTC’s accumulation trend score rising from 0.5 to 0.7 last week. This score reflects the relative size of entities accumulating coins on-chain in terms of their BTC holdings. A score closer to 1 indicates increased buying pressure.
Further analysis shows that Bitcoin’s NVT ratio has risen in recent days. A rising NVT ratio suggests that an asset is overvalued and could experience a price drop. However, the decreasing exchange reserve for BTC indicates that selling pressure is lessening. This, along with a low net deposit on exchanges, suggests that buying pressure remains high.
Examination of Bitcoin’s daily chart shows that BTC is being rejected at its resistance level. Its Relative Strength Index (RSI) is entering the overbought zone, which could lead to a price correction and a potential drop to $66k. However, if the bull run continues, BTC could reach $73k.