Just when Bitcoin enthusiasts thought they were riding a wave to new heights, the cryptocurrency hit a snag at the $28,000 mark. After a bullish run that saw Bitcoin break out from a $26,000 consolidation phase, the digital asset is now facing a bearish reversal. Additionally, Bitcoin saw a surge in accumulation just hours prior to Grayscale’s victory over the SEC. Now, it appears that investors are scouting for opportunities to sell and capitalize on the profits generated by this rally.
Bitcoin Faces Profit-Booking Sentiment Among Whales
After Grayscale’s legal win against the SEC, which fueled hope for the approval of spot Bitcoin ETFs, BTC’s price soared from $26,000 to nearly $28,184. However, this bullish surge was fleeting, as Bitcoin quickly encountered resistance at these higher levels, resulting in a 2% decline.
Per data from Santiment, holders of wallets with a balance ranging from 10 to 10,000 BTC accumulated an impressive $388.3 million, or 14,596 BTC, just hours prior to the announcement. According to IntoTheBlock, the number of large transactions has increased from 9.27K to 16.49K after the BTC price traded above $27K yesterday.
However, this spike in large transactions is not necessarily a bullish indicator; rather, it has contributed to creating bearish pressure on Bitcoin. Large holders who bought Bitcoin at lower prices may be selling to profit from the recent surge, increasing sell pressure. Their large sales can drain market liquidity, making it difficult for Bitcoin’s price to maintain its upward trend.
Interestingly, CryptoQuant data reveals a steep decline in the Long-term holder SOPR. The metric has dropped from 1.56 to 0.72 as Bitcoin jumped above $28K. “Long-term holders,” or LTHs, are Bitcoin investors who keep their coins for a minimum of 155 days before selling or transferring them.
The recent downturn indicates that these LTHs have grown impatient and are opting to sell at current levels to minimize losses, as they initially purchased Bitcoin at higher prices. This behavior signals waning confidence among holders, contributing to a bearish outlook for Bitcoin’s price.
What’s Next For BTC Price?
Both bulls and bears are battling as Bitcoin price declined from the high of $28,184 following a selloff. However, bulls are defending a decline below $27K strongly as it might trigger another wave of profit-booking. As of writing, BTC price trades at $27,184, declining over 2.2% in the last 24 hours.
Indicators such as surging moving averages and an overbought RSI level suggest that the bulls currently have an advantage. However, the bears are expected to put up a strong defense at the $28,700 resistance level, making it challenging for the bulls to continue the upward trend.
If the price bounces back from the support of the $26,800 level, it would imply that the BTC price could trigger another bullish surge and attempt to break above the resistance level. A surge above the $28,700 mark would signal renewed strength, potentially sending the price towards $30K.