According to data from CoinMarketCapBitcoin has had an unimpressive week, with its market price down 4.65% over the past seven days. However, prominent crypto analyst Ali Martinez has released a price warning indicating that the market leader could expect more losses if it fails to secure a certain support zone.
Related reading
Bitcoin URPD Chart Shows Potential Correction – Analyst
In an X-post on June 15Martinez stated that Bitcoin must quickly rise above $66,254 or risk a potential drop to around $61,100. Martinez based his theory on the UTXO Realized Price Distribution (URPD) chart, generated by the data analytics platform Glassnode.
#Bitcoin needs to climb back above $66,254 quickly to avoid a possible correction to $61,100! pic.twitter.com/WMr7jcAVJU
— Ali (@ali_charts) June 14, 2024
For context, an unspent transaction output (UTXO) refers to units of Bitcoin that have not been spent after a transaction. Each UTXO has a realized price, which is the price that was the market price at the time the UTXO was traded. In a UTXO Realized Price Distribution chart, Bitcoin supply is broken down based on the realized prices of UXTOs, which show how much BTC has been acquired at different levels.
This data can be used to study market sentiment, distribution analysis, and support and resistance levels. More importantly, investor behavior can also be studied, as a high concentration of UTXOs indicates levels at which most investors bought Bitcoin, which can translate into a potential resistance or support level.
According to the URPD chart shared by Martinez, 504,619 BTC was purchased at $66,254, indicating strong potential to serve as support for Bitcoin amid the current downtrend. Moreover, the next realized price with the highest number of Bitcoin purchased (191,366) is $61,101, which represents the next support level should the leading cryptocurrency fail to regain the $66,254 price.
Related reading
Bitcoin price overview
At the time of writing, Bitcoin is trading at $66,151, reflecting a 1.15% price drop in the past day. At the same time, BTC’s daily trading volume has also fallen by 5.54% and is valued at $25.4 billion. However, Bitcoin remains in the green on the monthly chart with a gain of 5.80%, which is remarkably positive, especially for long-term traders.
According to Coincodex, Nevertheless, the overall sentiment is bearish. The Fear and Greed Index stands at 74, indicating current optimism and risk-taking behavior among investors, indicating a potential for high market volatility.
Featured image from BBC, chart from Tradingview