Bitcoin’s slump continued on Monday, with the flagship cryptocurrency suffering a more than 10% dip intraday to fall as low as $30,527. The bleeding with the crypto markets followed last week’s drawdown that had come after losses on Wall Street in the wake of a 50 basis point interest rate hike by the US Federal Reserve.
This, together with the Fed’s quantitative tightening, has added to headwinds for the broader market.
On Monday, on-chain data provider Glassnode noted that Bitcoin’s dip to lows of $33K had pushed the amount of unprofitable BTC supply towards 60%.
This is after another 10% fell into the negative zone with the latest sell-off. Glassnode says there’s potential for more pain if the current bear market takes a route comparable to the historical 2015 and 2018 bear markets.
BTC near the bottom of a 16-month range
Despite the negative outlook and recent rot, Marcus Sotiriou, an analyst at digital asset platform GlobalBlock believes a bounce is imminent.
Commenting on his bullish stance in a note shared on Monday before BTC fell to lows of $30.5k, the analyst noted:
Technically, Bitcoin’s structure is bearish as lower-lows and lower-highs persist, but Bitcoin is now approaching the bottom of the 16-month range. The region near the low of the range, from $28-32k, could be a good region to add to long term holdings from a risk-reward perspective.”
Increase in HODLers suggests possible bounce
Another positive signal is on-chain metrics related to the continued optimism among long-term BTC holders. In his view on HODLer activity, Sotiriou added that Bitcoin that has not moved in the past year is at its all-time high.
Every time a macro bottom has formed in the market previously when this has happened, it has marked a bottom in the crypto market,” he opined.
According to him, the surge in the percentage of BTC dormant for a year is a positive signal that it is short-term holders who are selling while long-term remain steady.
Bitcoin was trading around $31,257, about 9.2% down in the past 24 hours. According to data from CoinGecko, BTC/USD has declined more than 54% since its all-time highs of $69k reached last November.
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