Bitcoin price retests key $22.8K as metric points to ‘BTC buying spree’

Bitcoin (BTC) returned to base on Aug. 4 as higher levels gave way to a battle for the 200-week moving average (MA).

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Battle for classic Bitcoin price trendline rages 

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD falling to repeatedly test the key bear market trendline as support.

The day’s Wall Street open provided only a brief change in the mood, with the pair spiking above $23,000 before continuing previous behavior.

The atmosphere was unchanged by news that investment giant BlackRock had partnered with major exchange Coinbase to provide crypto trading to clients.

Instead, the familiar status quo involving the 200-week MA just above $22,800 entered another chapter, with bulls and bears still tussling for control. On-chain analytics resource Material Indicators noted that one class of whales active on the largest global exchange, Binance, was in a more risk-off mood on the day.

“The purple class of whales have historically had the most influence over Bitcoin price action,” it wrote on Twitter alongside a chart of data from the Binance order book.

“Interesting to see them dumping into other classes pumping.”

BTC/USD buy and sell levels (Binance). Source: Material Indicators/ Twitter

Support was thin near the spot price, the chart showed, with more substantial bid interest only at around $22,400 in the event of a breakdown. Resistance, meanwhile, was building at $23,400.

“Lots of chop here on lower time frames but with this local sweep of the highs we finally look ready to get that flush down into downside targets,” popular trader Credible Crypto meanwhile added in his latest forecast on Aug. 3.

“Looking for a higher low and a reversal to continue upwards to 25k+ $BTC.”

Buying data hints of upcoming BTC supply shock

On the topic of buyer interest, on-chain data additionally showed a marked increase in the portion of the overall BTC turning illiquid.

Related: ‘Insane evidence’ Bitcoin has capitulated in past 2 months – analysis

Originally created by William Clemente, lead insights analyst at Blockware and statistician Willy Woo, the Illiquid Supply Shock (ISS) ratio metric saw what popular commentator Game of Trades called a “massive spike” in July.

ISSR increases when BTC is primarily being taken out of circulation, which in turn increases the likelihood of a price surge based on demand outweighing supply.

“The HODLers have gone on a buying spree unlike anything seen since 2018,” Game of Trades commented on the day, uploading SSR data hosted by on-chain analytics firm Glassnode.

Bitcoin Illiquid Supply Shock ratio annotated chart. Source: Games of Trades/ Twitter

Glassnode itself meanwhile noted that hodlers en masse were still selling more BTC at a loss than a profit, but that demand was likewise apt to be increasing currently.

“This is typical of bear markets, and a reversal is often associated with a pick up in demand,” it commented on a chart showing realized profits and losses per day.

Bitcoin realized profit and loss annotated chart. Source: Glassnode/ Twitter

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

All Dutch and English crypto news!

Blue chip NFT performance fails recovery, but investors HODL even harder

The market performance of blue chip nonfungible tokens (NFTs), often considered a good long-term investment, revisited its all-time low range for the second time since...

Chiliz is up by more than 15% on Tuesday: Here’s why

The cryptocurrency market continues its poor start to the week, but Chiliz has been performing excellently today.   CHZ, the native token of the Chiliz blockchain, is...

‘I alone am responsible,’ says CEO Do Kwon in first interview since collapse

The CEO of Terra has come out to take responsibility for the project's crash earlier this year.   Do Kwon, the founder of Terra, has given his...

Brazil brokerage giant with 3.6M clients launches BTC and ETH trading

Brazilian brokerage giant XP Inc has officially launched its crypto trading platform 'XTAGE' in Brazil, bringing a potential 3.6 million users to the crypto markets.  The...

Beste exchanges

Koop je crypto bij Bitvavo