With the realized price for long-term holders below $20,000, Bitcoin is unlikely to trade near this level in the current cycle, say analysts at Bitfinex.
Bitcoin (BTC) is unlikely to trade below $20,000 in the current cycle as a cohort of long-term holders have bought the cryptocurrency heavily since early February 2023 when BTC traded above $24,000, said Analysts from the crypto exchange Bitfinex in a current research report.
With Bitcoin currently trading at around $70,600, analysts emphasize that the holder's short-term realized price is $55,834, indicating its crucial role as a “crucial dynamic support/resistance level during this cycle.”
“Regardless of whether we see a decline in BTC, we do not expect a V-shaped recovery, as has been the case in previous declines since 2023.” Bitfinex
Analysts believe that a decline to $56,000 would involve the maximum decline from a new local high to low of around 23-24% overall.
Bitfinex noted that recent data from spot Bitcoin exchange-traded funds (ETFs) showed negative net flows for the first time last week, with negative net flows reported on every trading day. According to the exchange's estimates, total outflows, primarily from the Grayscale Bitcoin ETF, topped $2 billion this week, resulting in a net outflow of $896 million after accounting for inflows from other ETFs.
Despite the shift towards negative ETF inflows, analysts believe that this development is not a significant cause for concern as they attribute the outflows to investors shifting their funds from GBTC to other ETF providers that offer lower and more attractive management fees offer.
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