The co-founders of blockchain analytics platform Glassnode explain how Bitcoin (BTC) can regain six figures and more.
Glassnode and Swissblock co-founders Jan Happel and Yann Alleman, who part the social media handles Negentropic, start by comparing BTC’s current situation with a similar scenario from a few years ago.
“Let’s look at the period from December 2020 to February 2021, which corresponds to a similar cycle phase and similar price action.
At the time, liquidity outflows coincided with a price correction, but network growth continued. Likewise, the price rebounded sharply as the price stabilized and a new inflow of liquidity began.”
According to Negentropic, liquidity could be the deciding factor in a Bitcoin price pump.
“This suggests that we could potentially see a price pump once liquidity flows back into the market and the price does not fall to lower levels, as long as network growth remains at bullish levels.”
In matching Swissblock after, the market intelligence agency suggests that profit-taking must calm down before BTC can rise again.
“Profit taking above $90,000 and near $100,000 has persisted among market participants (no surprise, as long-term holders continue to take profits). However, this selling pressure is gradually losing intensity.
To resume price momentum within the bullish area, profit taking must stabilize and we must avoid large selling volumes that cause spikes on the chart.”
BTC is trading at $92,077 at the time of writing, down 1.7% on the day.
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Generated image: Midjourney