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(Kitco News) – It’s been a mild day of price action in the crypto market, which is increasingly showing signs of decoupling from traditional financial markets as stock prices continue to struggle amid mounting economic headwinds.
Major stock market indexes were down for the day, accompanied by a 2.62% drop in the US 10-year Treasury bond, with the S&P, Dow and Nasdaq down 2.11%, 1.54% and 2.84% respectively closed.
Despite the widespread pullback in traditional markets, data from TradingView shows that Bitcoin (BTC) price has remained relatively resilient despite a midday attempt by bears to push the price lower, resulting in a brief dip to $18,856, before bull reinforcements arrived to bid it is back above the $19,400 support.
BTC/USD 4 hour chart. Source: TradingView
Thursday’s muted price action is part of a developing trend, according to Kitco senior technical analyst Jim Wyckoff.
“This has led to a ‘slump in volatility’ despite greater risk aversion in the broader market,” Wyckoff said, adding that “Bitcoin bulls must be disappointed that prices have not risen amid the risk-off atmosphere in the markets. “
The weakening in volatility suggests that a “major price move is on the horizon,” according to Wyckoff, adding that “bears still have a slight technical advantage near-term.”
Looking ahead, Wyckoff suggested that “a move in BC prices above the September high would enable the bulls to suggest a price uptrend developing and a move below the September low would recharge the bears and restart a price downtrend “.
A promising on-chain metric
Insight into on-chain data for Bitcoin was provided by Marcus Sotiriou, an analyst for digital asset broker GlobalBlock, who noted that “on-chain analysis is showing some bullish signs.”
The specific metric Sotiriou was referring to is Bitcoin’s cost basis analysis, “which compares the realized price of LTH (Long Term Holder) to the realized price of STH (Short Term Holder).
Bitcoin on-chain cost basis. Source: Glassnode
As shown in the chart above, the STH realized price (pink line) fell below the LTH realized price (purple line) just three times in Bitcoin’s history before crossing again last weekend.
“The other instances where this happened indicated a bottoming process,” Sotiriou said. “We can keep an eye on when the STH band crosses the LTH band again to potentially signal a restart of the bull market if Bitcoin follows the same pattern as previous bear markets.”
Altcoin Snoozefest
As noted at the open, price action in the crypto market was muted on Thursday, with the vast majority of top altcoins trading within 1% of yesterday’s prices.
Daily performance of the cryptocurrency market. Source: Coin360
The day’s biggest gainers include a 16.07% price jump for Orbs (ORBS), a 6.32% gain for Request (REQ) and a 5.08% price increase for Flow (FLOW).
The total cryptocurrency market cap is now $938 billion and Bitcoin’s dominance rate is 39.6%.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of the author Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article assume no responsibility for any loss and/or damage resulting from the use of this publication.
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