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You are here: Home / News / Bitcoin News / Bitcoin at $10,000; “Psychological Resistance” No-More?
Bitcoin at $10,000; "Psychological Resistance" No-More?

Bitcoin at $10,000; “Psychological Resistance” No-More?

August 17, 2020 by Utkarsh Gupta

Over the years, the on-chain date for Bitcoin has become more and more useful. Just like traditional asset class (i.e. stocks, bonds, etc., etc.), historical information on the type of participants, market movements and other factors naturally made it possible for Bitcoin to develop further as an asset.

Now, since August, Bitcoin has been doing well to keep the price above $10,000, and a recent report suggests that a strong level of support for this range can be estimated.

OKEx Insights’ recent collaborated report with Catallact studied the behavioral pattern of Bitcoin and market sentiment of investors based on UTXOs.

Why is Bitcoin UTXO important?

For Bitcoin, UTXO is important because it allows the analyst to identify long positions of investors and their point of entry in the market.

Locations of UTXO buildups on the Bitcoin network

The chart above underlines an interesting difference between the two major clusters of UTXOs exhibited by the pink markers.

The first cluster arrived at the end of December 2018, when Bitcoin was at an absolute low valuation after the long crypto winter of 2018. It reflected that people were unconvinced that the price would no longer be higher.

Fast forward 2020, another major cluster can be observed, again under the resistance $10,000 but now investors were more positive, and they were willing to sit out the bearish pressure. So, the evolution of investor’s sentiment is largely evident.

After evaluation further changes in UTXO holdings in recent weeks realized and profit and losses, and spent output ratios, it was suggested that large positions in the Bitcoin have considerably moved above $10,000.

Before, a lot of the positions were accumulated between $6,000-$9,700, and after they were recently closed for profits, the downward pressure of Bitcoin has gradually decreased.

Realized profits and losses have also been tame during the recent bullish/bearish rally, indicating that maturity and optimism have been high on Bitcoin’s investor’s list. Additionally, the report added,

“The position buildup leading up to current levels (between $10K and $12K), coupled with the current mildness of profit-taking, indicates that these prices were deemed reasonable entry points by participants. It also indicates that those in profit are willing to hold their coins for larger gains in the future.”

Now, from the analysis, the point made was that Bitcoin might have reached strong support above $10,000 mark. With the price trailing that range for all these years, the solid foundation at $10,000 will positively equipped Bitcoin to march even higher.

Filed Under: Bitcoin News, News Tagged With: Bitcoin (BTC), bitcoin price

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