Bitcoin has been trading sideways which has slowed down the bullish momentum for the altcoins. Despite the struggle, the world’s largest crypto-asset has secured its support area and a major downside in the coming days appeared highly unlikely.
According to the crypto-analytic platform Santiment’s latest chart, there could be signs of fresh buying action in the coming days. If the Bitcoin network realized profit/loss [NPL] is to be taken into account, we can see from the chart above that it underwent a strong dip recently which suggested that investors were realizing losses amid the panic sell-offs.
Whereas abrupt spikes in Bitcoin’s NPL metric has often surged during price rallies, signaling regular profit-taking and a healthy amount of investor fear about the crypto-asset’s short-term potential.
The latest trend of laying low could essentially mean that support has been formed at the current level and Bitcoin could see an upward swing in its price in the coming days even as sellers attempted to break it on multiple occasions. The cryptocurrency has also been seeing large rounds of buying activity in a bid to counter selling pressure coming from the large whales especially from crypto giants such as Coinbase and Binance.
Bitcoin’s Buying Pressure Intact
Bitcoin currently exchanged hands at $36,286. The crypto-asset has enjoyed an impressive surge since the market crash of Black Thursday in mid 2020.
Following the recent market correction, the RSI noted a massive spike all the way to the overbought region followed by a lesser sharp reversal. Despite the fall, RSI was well-above the 50-median line. It is important to note that Bitcoin has managed to position itself above the buying zone since the first week of October.
The optimism in the space can be credited to the institutional investors who have flocked to the market en mass seeking a hedge against inflation as COVID wreaked havoc on the global economy. Even as Bitcoin’s rising demand pushed its market value by roughly 1,000% since the market crash, the upward momentum does not appear to be smooth. Here’s why
Despite its extended bull rally and swift breach of its new ATH above $42k, the resistance wall has jeopardized Bitcoin’s relief rally. According to a popular analyst, the crypto-asset’ss short-term upside potential faced strong rejection due to the high funding rates for leveraged positions. .