- Metric found that Bitcoin was overvalued.
- A price correction could push BTC back to $61,000.
After a price of almost 65,000 US dollars Bitcoin (BTC) turned bearish again as the daily chart of the king of cryptocurrencies turned red. While this was happening, short-term holders continued to sell their holdings. Does this mean a trend reversal or a continued price decline? Let’s find out.
Is the selling pressure on Bitcoin increasing?
The price of the king coin rose by more than 8% last week. The uptrend allowed the bulls to push the coin to $65,000 on August 24.
However, in the last 24 hours, there was a reversal as the BTC price dropped slightly. According to CoinMarketCapAt the time of writing, Bitcoin was trading at $63,816.53, with a market cap of over $1.28 trillion.
In the meantime, intoTheBlock published a tweet revealed an interesting pattern. According to the tweet, important information can be gained by keeping an eye on the balances of short-term traders.
In the past, increases in this metric have regularly coincided with market highs and lows, providing useful clues for choosing the right market time.
AMBCrypto then checked Glassnode’s data to find out how STHs were behaving. According to our analysis, STHs were on a selling spree. This was evident by the massive drop in the total supply of short-term holders over the past three months.
Source: Glassnode
BTC’s path into the future
To find out if BTC has reached its market bottom, AMBCrypto took a look at BTC’s Pi Cycle Top indicator. According to our analysis, BTC was right at its market bottom of $63.7k.
If the indicator is to be believed, BTC could soon begin its bull run and reach its possible market high of $102,000 in the coming weeks or months.
Source: Glassnode
We then checked other metrics to find out how likely it is that Bitcoin will start a new bull rally. Our analysis from CryptoQuants Data revealed that BTC’s Coinbase premium was green.
This meant that the buying mood among US investors was strong.
Source: CryptoQuant
BTC net deposits on exchanges were also low compared to the last seven-day average, indicating an increase in buying pressure. However, the king of cryptocurrencies’ NVT ratio saw a sharp increase.
Generally, an increase in this value means that an asset is overvalued, indicating a price correction.
Source: Glassnode
To read Bitcoin (BTC) Price Prediction 2024-25
Like the above metrics, the market indicators for BTC also looked quite pessimistic. For example, the Chaikin Money Flow (CMF) recorded a downtrend. The Relative Strength Index (RSI) also followed a similar path.
These suggest that investors may see a short-term decline in the BTC price before it regains momentum.
Source: TradingView
