Key Points
- The number of long positions in the Bitcoin market has seen an increase.
- Despite recent price drops, Bitcoin’s current value is significantly below its potential, indicating a good buying opportunity.
Bitcoin, often referred to as the king coin, is currently trading under $57k. This may seem alarming at first glance, but for seasoned investors, it might present a golden opportunity to buy the dip.
Data from CoinMarketCap shows that Bitcoin’s price has fallen by over 3% in the past week. In the last 24 hours alone, a nearly 4% price drop was observed.
Bitcoin’s Current Trading Status
At the time of writing, Bitcoin was valued at $56,760.06, boasting a market capitalization of over $1.12 trillion. A popular crypto analyst, Ali, shared a tweet revealing a bullish development. According to him, 51.79% of top Bitcoin traders on Binance are holding long positions on Bitcoin.
Generally, an increase in long positions in the market suggests a growing bullish sentiment around an asset. This led to a deeper examination of Bitcoin’s current state to determine if buying the dip should be considered.
Analysing Bitcoin’s Potential Growth
Data from Glassnode indicates that Bitcoin is trading significantly below its possible market bottom. The Pi Cycle Top indicator places Bitcoin’s potential market bottom at $58.9k, suggesting a possible upward movement towards this value in the upcoming days.
The Bitcoin Rainbow Chart shows Bitcoin’s price in the “Basically a Fire Sale” zone, indicating that its current price is considerably lower than it should be. This presents a prime opportunity for accumulation.
Looking at CryptoQuant’s data, it was found that Bitcoin’s Exchange Reserve is decreasing, signaling an increase in buying pressure. Moreover, its Korea Premium turned green, showing a dominant buying sentiment among Korean investors. However, a red Coinbase Premium suggests that U.S. investors may be considering selling Bitcoin.
Regarding Bitcoin’s future, the Chaikin Money Flow (CMF) recorded an uptick, indicating that Bitcoin’s bearish price action might soon end. However, the Relative Strength Index (RSI) moved southwards, suggesting that Bitcoin’s price may still have the potential to fall further.
