Bitcoin (BTC), the leading cryptocurrency, faces significant challenges after failing to close above the critical $105,000 resistance level. This price point has consistently acted as a ceiling, limiting further upward momentum. The situation worsened as long-term holders (LTHs) began liquidating their positions, increasing selling pressure and driving prices downward.
Why Bitcoin Investors Are Losing Patience
Recent data reveals a sharp spike in Bitcoin’s Active Supply metric, which tracks LTH activity. This surge indicates that many long-term holders have sold their BTC holdings in recent days. Supporting this observation are:
- Declining LTH balances
- Rising Coin Days Destroyed (CDD), signaling movement of previously dormant coins
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Historically, LTHs are considered pillars of Bitcoin’s stability. Their sell-offs often lead to bearish outcomes—a trend that intensified over the weekend and extended into this week, accelerating the price decline.
Macro Indicators Suggest Recovery Potential
Despite the downturn, key metrics hint at possible recovery:
| Metric | Current Status | Implication |
|---|---|---|
| NVT Signal | Low | BTC is undervalued vs. network usage |
| Exchange Netflow | Neutral | No extreme sell-side pressure |
The Network Value to Transactions (NVT) Signal, a vital valuation tool, remains at lower levels. This suggests Bitcoin is undervalued relative to its transaction volume, leaving room for future growth. However, broader market signals must align for BTC to regain strength.
Bitcoin Price Prediction: Key Levels to Watch
BTC dropped 3.88% in 24 hours to $100,682, driven by:
1. LTH liquidations
2. Rejection at $105,000 resistance
Critical Support and Resistance Zones
Support Levels
– $100,000: Psychological and technical support. A bounce here could stabilize prices.
– $95,668: Next downside target if $100K fails.
Resistance Levels
– $105,000: Reclaiming this as support could invalidate bearish sentiment.
– $109,699: All-time high (ATH)—a breakthrough may trigger renewed bullish momentum.
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FAQs: Addressing Key Concerns
Q: Why do long-term holders selling affect Bitcoin’s price?
A: LTHs typically hold through volatility. Their sales signal reduced confidence, increasing market supply and downward pressure.
Q: Is Bitcoin still a good investment after this drop?
A: Metrics like NVT Signal suggest undervaluation, but monitor macroeconomic factors and institutional adoption for long-term potential.
Q: What would trigger a rebound?
A: Key catalysts include ETF inflows, positive regulatory news, or Bitcoin closing decisively above $105K.
Final Thoughts
While LTH sell-offs have dampened sentiment, Bitcoin’s underlying metrics reveal opportunities. Traders should watch the $100K support and broader market trends for directional cues. Strategic accumulation during dips could benefit those with longer horizons.