Bitcoin 360 #17: 6th August 2021
Hi everyone, welcome to the latest instalment of Bitcoin 360! A week full of volatility, we don’t know which way to turn! Thus, on the cards today: an explanation of on-chain data to understand the events of in the recent hours, as well as technical analysis. Well, I’ll leave you to it. Have a good read!
The distribution phase
Various on-chain data demonstrates an accumulation pattern. The market whales are holding onto their coins. We are in a situation rather similar to mid-2018, moving towards an accumulation phase.
Thanks to this Glassnode graph we can see that unlike 2018, long-term Bitcoin holders hold 10% more this time. A significant difference which points to the strong long-term-oriented distribution phase. In my opinion, we are leaving the ultra-speculative aspect of 2017-2018 behind in favour of long-term investment, particularly via institutions and businesses.
High volatility at the top of the range
Bitcoin remains in its range. We thought it may break down earlier this week, but the price is finally headed for the top of the range. It has retraced part of its rise before going up slightly again.
Now we have two options. Either a range breakout to continue the rise and try to go for $50,000, or a return to the mid-range: see the bottom of the range with this OB (Order Block) in particular, it may affect the price.
On the four-hour chart, the price is on an OB (Order Block) which corresponds to the 70.5% Fibonacci level. An area which, I think, will be defended by sellers. The OB on the $38,000 is equally controlled by the bulls.
Which of the two areas will break first? We don’t really know, but we should look out for it. Once broken, the trend may continue in this direction.
Finally, on the one-hourly chart, Fibonacci levels seem to be significant enough to stand in the way of the price. We see it especially with the strong wicks. The price rests on the last top to act as support.
Price volatility is high, so trade carefully. A stop loss is required to safeguard against a strong bearish candle.
That’s it for today, feel free to share your thoughts with me on Twitter. Never invest more than you can afford to lose and DYOR. Happy trading and see you next Friday for a new article on CoinTribune! If you missed last week’s analysis, make sure to catch up!
Passionate about technical analysis and technology, I have been diligently following cryptocurrencies since 2017. Beyond trading and investing, I try to democratise, in my own way, the ecosystem that will undoubtedly change our habits in the future!