The bitcoin market is deep in the red and this is the fifth and largest correction in the current bull run. However, those who look at the long-term positions continue to accumulate.
The price of bitcoin has remained constant over the last 24 hours (here the quotation in real time), while panic-driven sales have eased and weak hands appear to have been wiped out.
At press time, BTC was trading at just over $ 45.400, up 5% from the same time yesterday. Its low during this correction was $ 42.000 on May 17, and this level was held twice as support.
The correction was 35% in 35 days, making it the largest of the current rallies. This almost mirrored a similar correction during the 2017 bull market, according to the supplier's results from Glassnode.
Using data from Glassnode's weekly report, analysts confirmed that new entrants to the market capitulated at a loss. However, long-term holders continued to buy lower.
Weak hands sell due to panic
Glassnode went on to report that the non-zero Bitcoin address count decreased during this fix, but the number of addresses increased 1,1% from the recent low.
"In almost perfect opposition to the sales of new entrants, long-term holders seem to buy the decline and accumulate cheaper coins."
He added that the offering held by long-term holders has reverted to accumulation mode, a pattern that is reminiscent of the 2017 high once again. Bitcoin buyers who bought coins in late 2020 or January 2021 did not spend the their coins.
Those who were taken by surprise on Twitter by Elon Musk over the weekend may have sold at a loss, while the more experienced ones had already predicted everything. A parabolic price chart is unnatural and unhealthy, and corrections are needed to shake off overly indebted positions and weak hands, so that it can resume a more natural, long-term uptrend.
“There are strong signs that short-term holders are driving downs with panic-driven sales. However, long-term holders are stepping in to buy the decline and their confidence is largely unshakable. "
The price of Bitcoin
Most of the major panic-driven sells appear to have ended, with BTC finding strong support at the low end of $ 40.000. Prices are back to their early February levels, but are still up 367% from the same period last year. So anyone who bought in 2020 will still be in profit and by a large margin.
A broader selloff could see prices revert to the support of the 200-day moving average, which is currently at $ 40.000. On the upside, Bitcoin could break the overhead resistance at $ 46.750 to make further progress.
