US: Bitcoin Attempts Recovery Amidst Market Volatility

Bitcoin's price aims to recover above $67,000, following a week-long sell-off that led to a dip to $65,000. Despite market volatility impacting altcoins like Ethereum and Solana, long-term investors appear to be selling, meeting demand from new investors who now hold approximately 44% of aggregate network wealth.

Bitcoin Price Analysis: BTC Attempts Recovery Amidst Market Volatility

Introduction

The cryptocurrency market has experienced significant volatility in recent weeks, with Bitcoin (BTC) facing intense selling pressure that pushed its price below $65,000. As the week draws to a close, BTC is attempting a recovery, but market sentiment remains uncertain.

Long-Term Investors Sell at All-Time Highs

Blockchain data analysis suggests that long-term Bitcoin investors have been selling their holdings near all-time highs. This selling activity has been driven by the surge in demand for BTC from newer investors, who now hold approximately 44% of the network's total wealth.

Correlation with Altcoins Declines

A recent report by Kaiko reveals that Bitcoin's 60-day correlation with altcoins has dropped to its lowest level in years during the first quarter of 2024. This indicates that altcoins are no longer closely following Bitcoin's price movements as they have in the past.

Whales Sell Amidst Halving Speculation

Following a brief recovery above $70,000 in March, Bitcoin's price has struggled to maintain its momentum due to selling pressure from large investors known as "whales." Blockchain data indicates that these whales have been taking profits while anticipating a surge in demand for BTC ahead of the April halving.

Government BTC Sales Dampen Market Sentiment

The United States government's recent announcement that it sold nearly 10,000 BTC from its seizure of the Silk Road darknet marketplace has further dampened market sentiment. Traders have expressed concerns about potential additional sales and the impact on the price of BTC.

Technical Analysis

After briefly retesting its previous day's open at $68,485, Bitcoin's price has stabilized around $67,972. Technical analysis suggests that the 50-day Exponential Moving Average (EMA) at $67,802 provides immediate support for BTC. Breaking above this level could lead to a potential surge towards areas above $70,000.

However, the Relative Strength Index (RSI) remains below its trendline resistance, indicating potential sell-side pressure. In case of further downward movement, the 20-day EMA at $67,336 and the 200-day EMA at $65,773 may serve as support levels to prevent significant losses.

Conclusion

The Bitcoin market is facing a period of uncertainty as it attempts to recover from recent losses. Long-term investors have taken profits, while whales have been selling amidst speculation about the upcoming halving. The government's sale of seized BTC has also weighed on market sentiment.

Technical analysis suggests that BTC is facing immediate support at the 50-day EMA, but further selling pressure could push the price lower. Investors should monitor the RSI and the broader market dynamics to assess the likelihood of a sustained recovery or potential further declines.