The price of Bitcoin (BTC) consolidates below USD 9,200, which has been an important support level since the end of May. According to Cole Garner, BTC may drop below $ 10,000 in the long term if it drops to $ 7,000.
Bitcoin is prone to fall in the $ 6,000 to $ 7,000 range below the green line. Source: Cole Garner
On-chain data analyst Garner said::
“Technically, we’re still in the bull market. A drop under the VWAP [el nivel verde] It is a juicy purchase opportunity. It could be the last BTFD under $ 10,000. Forever”.
Why are traders generally pessimistic about the short-term trend of Bitcoin?
As Cointelegraph previously reported, Analysts are cautious about Bitcoin because of four main factors. That is, the increase in sales pressure from miners, uncertainty on the stock markets, consolidation at a pivot price and the decrease in volatility.
Miners who sell a large amount of Bitcoin are not new, however, since they have sold most of what they mine every day since halving on May 11.
But, The massive sale of miners coincides with other worrying factors, such as the CME bitcoin market, which is clearly short. This suggests that professional traders expect a temporary drop in BTC.
“And retailers’ CME engagement shows that institutions have massive short BTCs and have had them for many weeks. They were only once so short: the last time BTC was about the same price. “
The market data for Bitcoin options support this representation. On June 26, the Bitcoin options market saw the longest decline in history with options valued at $ 675 million. However, BTC’s price did not show a sharp increase in volatility, indicating that most options were offered when BTC was in a narrow range between $ 9,000 and $ 10,000.
Currently, the Bitcoin options market is generally net neutral, while the CME futures market remains net short. When combined with the fact that miners sell 1,115 BTC more than they have mined since June 19, the trend can get grim.
Bitcoin miners sold more BTC than in the past seven days. Source: ByteTree
Why are analysts positive about BTC’s medium-term trend?
Long term, Garner still expects a large bull market. In addition to optimistic developments in the industry, such as the growing support from Fidelity and the institutional takeover, an important macro indicator has emerged.
Even the hash tapes, They evaluate the possible phases of surrender among miners on the cryptocurrency market and signal an upward trend. Mining surrender generally marks a local floor for Bitcoin as over-levered miners and investors are eliminated. Garner noted:
“We are about to buy hash tapes. Buying hash bands is one of the highest alpha on chain signals I am tracking. They don’t happen very often and I hope it will be the last time in a long time. “
As fundamentals improve and the mining industry is finally recovering from halving and two year adjustment with high levels of difficulty, traders expect the Bitcoin price to recover.