Bitcoin ($BTC) holders, and those looking to long or short the number one cryptocurrency, are currently indecisive. Bitcoin all but reached the $100,000 price level, but has been rather volatile since then. Is there more downside to come, or is this just another period of consolidation before Bitcoin shoots much higher?
Long-term holders take profits, but a smaller percentage each time
For the average retail investor, who perhaps hasn’t been in the Bitcoin trading/investing space very long, a rather difficult decision is perhaps being mulled over. The king of the cryptocurrencies recently reached the incredibly important milestone of $100,000 (or just a couple of hundred dollars short of it). Market wisdom says that these big round figures are likely levels where many investors will be taking profits.
Indeed, this has very likely happened. Long-term investors use these landmark levels to sell part of their bags into the huge liquidity that accumulates as these levels are reached.
However, be that as it may, long-term holders are selling a smaller percentage of their Bitcoin as time goes on. During the latest price surge long-term holders have sold just less than 4% of their holdings, while in the run-up to the 2017 bull market peak, around 25% of long-term holdings was sold, and in 2021 the figure was 13.4%.
Three trendlines in play
Source: TradingView
The daily chart for $BTC shows that since almost hitting the $100,000 level, the price has generally been going down and sideways for almost a week so far. This is par for the course after hitting such a stand-out price level, and a period of absorption is absolutely to be expected.
Three trendlines are currently in play. The first, and shortest trendline, is displaying the down and sideways movement for the last few days. The ascending trendline, taken from 12 November, shows the run-up to the all-time high. This trendline has now been broken, and price is still being rejected from this line.
The last trendline, and easily the most important, stretches all the way back to the double top of the last bull market in 2021. It seems that the $BTC price is struggling to definitively get above this trendline, and stay there.
The trend is your friend
Source: TradingView
Zooming out into the 2-week timeframe, it can be observed how the $BTC price had an extremely difficult time to finally break through the old all-time high set at the top of the 2021 bull market.
That said, the last 2-week candle was the first to open above the $69,000 horizontal level, and it towers above it, reaching all the way to the ascending trendline. The current 2-week candle is battling with that trendline, plus the psychological $100,000 level.
If one looks at the bottom of the chart, the Stochastic RSI is heading up nicely, showing that there is room for a lot more upside. The oft-said market wisdom that “the trend is your friend, until the end” is probably very pertinent here. New traders and investors take heed.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Source: https://cryptodaily.co.uk/2024/11/bitcoin-btc-keeps-everyone-guessing-up-or-down-from-here