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- Bearish momentum waned as BTC compressed into a tight range.
- A rising average coin age suggested that active buyers wanted to buy BTC at lower prices in anticipation of a price recovery.
Investors continued to approach Bitcoin [BTC] with cautious sentiment as the market slowly recovers from last week’s panic wave. BTC’s sharp drop from $28.5k to $25.2k on August 17th sparked fear in the crypto market.
How much are 1,10,100 BTC worth today?
Nevertheless, the sideways price action of the king of cryptos indicated a low in the price. Along with increasingly positive signals from chart indicators, traders could be witnessing a price recovery in the near term.
Are bears exhausted?
Source: BTC/USDT on trade view
Sellers appeared to have lost steam as selling pressure eased after BTC broke below the $26.5k support level. A mix of bullish and bearish candlesticks on the 12-hour timeframe sparked the idea of a bullish comeback for Bitcoin.
A look at the Relative Strength Index (RSI) and Chaikin Money Flow (CMF) suggested that a price recovery could be imminent. While the RSI remained in the oversold zone, it rose from 9 to 19, signaling recovery attempts by the bulls.
Therefore, a climb out of the oversold zone could significantly accelerate BTC’s recovery. Similarly, the CMF moved from -0.21 to -0.11, indicating a slow recovery in capital inflows.
If bulls are able to take back the $29.5k level along with the positive indicators, buyers can make a push for $27k to $27.5k. On the other hand, sellers could be waiting in the wings for another major opportunity to short the $25.3k support before a substantial price reversal takes place.
The rising average coin age suggested that buyers were active
Source: Sentiment
Dates from Sanitation showed that the average coin age of 90 days has been in an upward trend since August 18. This indicated an accumulation of BTC at low prices with the intention of sparking a sustained bullish rally.
Read Bitcoin [BTC] Price Forecast 2023-24
With a market value to realized value (MVRV) of -8.58%, this meant that long-term holders were still holding on to unrealized losses.
Along with the rising average coin age, long-term holders could buy at lower prices with the aim of making a marginal profit in the event of a price recovery.