Bitcoin's recent retreat, down about 6% from its peak, has brought the price to around $115,736. But, don’t be too quick to call it a crash, Bitcoin is still holding strong with a steady momentum, though signs of short-term pressure are starting to peek through, primarily from miners and long-term holders cashing out.
Here’s the tea: According to a July 16 analysis from CryptoQuant’s Avocado_onchain, the Miners' Position Index has risen above 2.7. This means miners are moving more BTC to exchanges than usual, something that’s often a precursor to a short-term correction. We’ve seen this before when miners lock in profits after significant price jumps.
But don’t panic just yet. This MPI reading is far from the crazy extremes we saw during previous market tops. It could just be part of the typical bull market cycle, a little pause or pullback before the next big surge.
Long-Term Outlook
Also worth noting is the profit-taking spike from long-term holders about 10 days ago, as mentioned by Onchain School in another July 16 CryptoQuant report. While it didn’t stop Bitcoin’s price from continuing to rise, the movement of older coins suggests that some early investors are cashing out. Is this the beginning of the end? Or just a temporary break? Time will tell.
Right now, Bitcoin is up 1.15% in the last day and 8% in the last week. However, trading volume dropped by 9.7% to $63.9 billion over the last 24 hours, while futures and open interest also saw declines. It’s like the market is taking a breather, with less excitement around derivatives.
On the technical front, Bitcoin is still in a solid uptrend. The price remains above key moving averages and the middle band of the Bollinger Bands. The relative strength index (RSI) sits at 67.42, just under overbought territory, leaving room for some more upward movement without overheating the market.
Looking at the near-term action, Bitcoin could hit resistance around $121,000 to $123,000. If the price dips, there’s support near $111,000, with a backup at $102,000. A retest of these levels could be just what the market needs to recharge before another leg up.
Despite some short-term pullbacks, Bitcoin’s long-term outlook is still looking rosy. The macro environment continues to favor it as a store of value, and there’s no sign of institutional holders pulling out just yet. Miners aren’t in panic mode either. So, if Bitcoin dips, it could actually present a great buying opportunity rather than signaling a major reversal.
Matvii Diadkov
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