- The Bitcoin price shows weakness in the short term falling under 50-day EMA and eyeing the next support at 200-day EMA.
- Bitcoin whale accumulation hits a new low indicating pain in the short term. However, BTC’s subdued volatility indicates long-term bullishness.
Since the beginning of the week, the broader cryptocurrency market has come under selling pressure with the Bitcoin price now slipping under $29,000. As of press time, BTC is trading 1.38% down at a price of $28,983 and a market cap of $563 billion. The next immediate support level for Bitcoin stands at $28,500.
Just as the crypto market is trying to come to terms with the current exploit in the DeFi platform Curve Finance, it faces another blow. The U.S. Securities and Exchange Commission (SEC) has launched a lawsuit against internet marketer Richard Heart, while attacking his projects Pulse Chain, Hex, and PulseX.
The last month of July 2023 turned out to be dismal for Bitcoin investors with the BTC price retracing by 5.5%. Also, as per on-chain data provider Santiment, there’s a very low level of whale transactions taking place on the Bitcoin network which is a concerning sign.
“Even with the drop below $30k, key stakeholders are not showing a big interest in buying the dip while Bitcoin’s market cap has slowly faded down to its current $29k price level,” noted Santiment.
Courtesy: Santiment
Bitcoin Short-Term Price Performance
Amid the recent selling pressure, the Bitcoin (BTC) price has already dropped under the 50-day moving average which is somewhere around $30,000 levels.
There is a possibility that the price might drop toward the 200-day moving average, which is at around $27K. The 200-day MA has historically played a significant role, pushing the price higher in the past, like it did in February.
If the price manages to rise above the crucial $30K level, we could see a rally toward the $38K resistance zone in the coming weeks.
However, Bitcoin bulls are pointing out the current subdued volatility in the Bitcoin price for a long-term price rally. Bitcoin realized volatility hasn’t been this low since July 2020. Every time the Bitcoin price volatility has been this low in the past, it has led to a strong price rally later.
In 8 out of 9 instances when volatility was this low, the market experienced upward expansion. The only exception was during a period of 6 months of consolidation that followed the 2017 parabolic blow-off top.
8 out of 9 times volatility was this low we saw expansion to the upside. The one time that we didn’t was after 6 months of consolidation that followed the 2017 parabolic blow-off top.
Place your bets, mine is 🆙 BIG. $BTC https://t.co/W7JkgSg6KM
— CrediBULL Crypto (@CredibleCrypto) July 31, 2023
The Scenario in the Altcoin Space, Ethereum Suffers
Apart from Bitcoin, the scenario in the altcoin space is also not much encouraging. Except for XRP, SOL, and XLM, other altcoins haven’t performed much well.
Along with Bitcoin, the world’s second-largest cryptocurrency Ethereum (ETH) corrected by 4.7% in the month of July. Also, analysts are also not quite positive about Ethereum in the short term.
According to Edward Moya, a Senior Analyst at OANDA, the Curve Finance hack is a setback for Ethereum’s DeFi ecosystem, but it’s unlikely to cause a major selloff in Bitcoin.
Crypto analyst Benjamin Cowen agrees, stating that historical data suggests Ethereum may not perform its best during Q3, or the summer months when it comes to return on investment (ROI) for investors. Cowen added:
“The one-year timeframe shows you that December and January are best, on average. The worst month was July. If you think about it, think about where ETH was last July. It wasn’t at a very different price than what it is today, I mean you’re talking pretty much the same price, maybe plus or minus a couple of hundred dollars but that’s where we were last July. And you can see there’s this sort of lull in even the one-year ROI buying in that April, May, June July timeframe but as you get further out into Q4, it tends to go up.”
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