The price of Bitcoin (BTC) has been facing challenges in breaching the significant resistance level of $98.7k over the past three weeks. This stagnation hints at a potential midterm correction, delaying the much-anticipated breakthrough of the $100k mark. The current bullish momentum appears to be insufficient, indicating that achieving new highs may take longer than expected.
Moreover, Bitcoin’s daily active address count and whale activity have seen notable declines recently. Historically, these metrics need to rebound to sustain a bullish trend for Bitcoin in the short term. Let’s delve deeper into these dynamics and understand what technical indicators are revealing about Bitcoin’s potential future movements.
Understanding the Technical Indicators
From a technical analysis perspective, Bitcoin’s price chart has been exhibiting signs of a possible midterm reversal pattern. According to crypto analyst Ali Martinez, Bitcoin’s price, when observed in the one-hour time frame, is forming a head and shoulder (H&S) pattern. This pattern is coupled with bearish divergence on the Relative Strength Index (RSI), which is often considered a signal of potential downward pressure.
If Bitcoin continues to face difficulties in surpassing the $98.7k threshold, Martinez predicts a potential decline toward the $90k mark. Should the bearish trend persist, Bitcoin might dip to the support level just above $85k before any new bullish momentum is likely to emerge.
Whale Investors and Their Mixed Signals
On-chain analytics from IntoTheBlock reveal that long-term Bitcoin holders are gradually decreasing their holdings. Currently, these holders possess about 12.45 million BTC, marking the lowest level since July 2022. However, this reduction is relatively modest compared to previous cycles, indicating a more cautious approach from investors rather than an aggressive sell-off.
Institutional Demand and Its Effects on Exchange Supply
Recently, Coinpedia reported that institutional demand, primarily driven by firms such as MicroStrategy and BlackRock’s IBIT, is influencing Bitcoin’s availability on centralized exchanges. Over the last month, there has been a reduction of over 123k BTC in exchange supply, bringing it down to approximately 2.27 million BTC. This trend suggests that institutional interest is tightening liquidity on exchanges, thereby contributing to the ongoing market consolidation.
Frequently Asked Questions
Why is Bitcoin struggling to surpass $98.7k?
The primary reasons for Bitcoin’s struggle to break past the $98.7k resistance level include weak bullish momentum and a decline in daily active addresses, both of which are essential for driving the price upward.
How does institutional demand impact Bitcoin supply on exchanges?
Institutional buying has significantly reduced the Bitcoin supply on exchanges to around 2.27 million BTC. This reduction in supply lowers liquidity, thereby contributing to the consolidation of Bitcoin prices.
How much will 1 Bitcoin be worth in 2025?
According to Coinpedia’s BTC price prediction, 1 BTC could potentially reach a peak value of $169,046 by 2025. However, it’s important to note that this is a speculative prediction and actual future prices may vary.
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