The bears on Bitcoin price are back! This time around, the price of Bitcoin has dropped by roughly 14% to around $34,700. Unless this change in price is reversed, the bears are back in charge, and it is likely that we will see more price drops in the near future.
The price of Bitcoin saw a somewhat surprising turn this week, as the cryptocurrency slid to as low as $34,000 on Friday. However, prices are now rebounding and trading in the $35K range, which is still far below the all-time high of $47,783 set in mid-December. To many, this is considered a disappointment, given that Bitcoin’s price was once near the $20K range. But the truth is that Bitcoin’s price is still over 10 times higher than it was a year ago, which is still substantial considering that it was worth nothing two years ago.
Today, the market seems to have finally pushed through the initial bearish spasm and recovered a little from the fall that followed the end of last week. It has also brought Bitcoin back to something around the $35K mark. However, the news of the day has come out of Japan, where the nation’s exchange authorities have banned the use of cryptocurrencies. The timing of this news couldn’t have been more unfortunate for Bitcoin, but it has also triggered a new wave of selling pressure.Although the bulls have shown strength in morning trade, the price of bitcoin (BTC) is still below the $35,000 resistance level and cannot reverse the 20-day moving average to support it or make a daily close above that level.
Data from Cointelegraph Markets Pro and TradingView Since bitcoin’s launch on 28. June at $35,400, it is trading between $33,850 and $35,000 while the impact of Chinese restrictions on BTC mining continues to ripple through the market.
4 hour chart BTC/USDT. Source: TradingView
The Chinese government has not only disrupted the bitcoin mining ecosystem, but has also put the screws to local cryptocurrency exchanges, leading to the closure of BTCChina. China has also banned cryptocurrency derivatives trading for users of the Huobi exchange.
BTC flows on Bitfinex are flagged as sales continue
According to Glassnode, last week’s downward price movement seems to have caused panic among long and short holders, as evidenced by volatility in SOPR LTH and deep capitulation in SOPR STH.
Bitcoin short and long term SOPR holders. Source: Glassnode
STH realized losses only slightly below its March 2020 performance. LTHs were willing to issue coins, with the average value this week fluctuating between $9,200 and $16,300, indicating a high degree of uncertainty.
To better understand current market conditions, CryptoQuant has highlighted Bitcoin inflows and outflows on Bitfinex as a potential indicator of market trends.
We expect a quick reversal of the upward trend.
Read morehttp://t.co/xw0v70LMO5 pic.twitter.com/tziBkJgadI
– CryptoQuant.com (@cryptoquant_com) 28. June 2021
According to CryptoQuant’s analysis, the market has seen a relatively high derivative of BTC spot flow, a change that usually implies a turn in the market.
CryptoQuant pointed out that the recent rise in the average inflow of bitcoin across all exchanges (MA7) suggests that the large deposits that caused the decline are coming to an end, an observation confirmed by the outflow of bitcoin from the Bitfinex exchange, which was considered the main culprit of the recent downward trend.
The increasingly risky situation in which the bears find themselves was highlighted by crypto currency analyst William Clemente III on Twitter, who posted the following tweet in which he indicated 11 consecutive days of negative funding.
Funding has been negative for 11 days in a row.
Translation: Short positions pay long positions to keep their positions open pic.twitter.com/PkGJ8LGPPz
– William Clemente III (@WClementeIII) June 28, 2021
Bitcoin rally offers relief for altcoins
Most altcoin prices moved while bitcoin showed signs of life above $34,000, including a 15.7% rise in the price of Ether (ETH) that briefly pushed the main altcoin above $2,100.
Daily indicators for the crypto-currency market. Source: Coin360
Shares of Populous (PPT) were the top performer of the day, rising 100% to an intraday high of $2.67, while IoTeX (IOTX), Kusama (KSM) and Compound (COMP) posted gains of 33%.
The total cryptocurrency market is now $1.402 trillion and bitcoin’s share is 46.1%.
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