Bitcoin is among the assets that have shown high volatility in the current crypto bear market. Recently, BTC price has been hovering around the $20K level. However, with the major cryptocurrency uncertain, most of its long-term holders have shown no deviation from the token. Therefore, it seems that he has not taken any position.
Data from on-chain analytics firm Crypto Quant noted some selling of BTC holders despite the lower price. However, the current BTC sell-off sentiment is in anticipation of a further drop in the bitcoin price. This is in contrast to the pre-sale built on the assumption of a price increase for the king of the cryptocurrency.
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But the persistent cryptocurrency seems to be putting more pressure on long-term holders of bitcoin. Ghodducifer, the author of Crypto Quant, noted that most of the recent BTC sales have come from one-year token holders.
Furthermore, it is stated that in previous cycles such action only occurred when the BTC price moved up. Therefore, holders may fear a drop in the bitcoin price in the future.
The bitcoin market is experiencing an increase in whale activity as the crypto winter becomes more intense. Before now, the strong arm seemed to ignore the rising decline in BTC.
However, seeing the market surpassing their actual price, they should enter the drawdown zone. Their actions contributed to more bitcoin selling their holdings to long-term holders.
BTC Risk Indicator Hits All Time Low
Further analysis of bitcoin’s leading indicators is not heartening for its investment. Currently, the key risk indicator for bitcoin reserves is at an all-time low. This indicator gives a measure of holders’ confidence in BTC.
The Trendy Patterns for Risk Indicator of Bitcoin Reserves has shown a steep decline over the past few months. Among the many opposing factors to the stability of the largest cryptos are the prevailing bear market and other macroeconomic indicators.
BTC has lost almost 60% of its value as of November 2021. Nevertheless, the token’s indices on fear and greed indicate more downside. They are pointing to a decline.
According to the opinion of a crypto enthusiast, Skin, the market has entered the lower zone of its higher time frame. He added that BTC Reserve’s risk indicator at its all-time low speaks volumes about its low price position.
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The implication is either a broken out indicator or a higher time frame lower zone. But the enthusiast said it is more likely to be the latter.
Featured image from Westend61, chart from TradingView.com