- The US government transferred billions of dollars worth of BTC at a time when selling pressure was already high.
- However, a bullish divergence appeared on BTC’s chart, indicating a trend reversal.
Bitcoin [BTC] had shown promising performance in recent days as the price moved closer to $70,000. However, over the past 24 hours, the bears have increased and pushed down the price of the king coin.
Let’s take a closer look at the market to find out why Bitcoin is down today.
Why Did Bitcoin Fall Today?
As sellers took control, the price of BTC fell by more than 4% in the last 24 hours CoinMarketCap. AMBCrypto had previously reported that there were chances that BTC would drop to $66k.
At the time of writing, BTC was trading at $66,672.03 with a market cap of over $1.32 trillion.
On July 29, IntoTheBlock pointed out a possible reason behind BTC’s latest dip. According to the tweet, almost all BTC holders made a profit.
While this looked optimistic at first glance, it might instead have motivated investors to sell their holdings to make a profit, resulting in this price correction.
The role of the US government
Look at chain revealed yet another possible reason for Bitcoin’s price drop. On July 29, the US government transferred BTC worth more than $2 billion to a new wallet.
At the time of writing, the US government owned 179,155 BTC, worth $12.14 billion.
In general, when governments make such large transfers, it affects market sentiment and causes volatility. For example, a few weeks ago the German government sold all its BTC holdings, which impacted the price of Bitcoin.
Since the US is a major crypto market, it is no surprise that BTC is falling due to a large transfer by the US government.
There is hope for bulls
However, AMBCrypto’s analysis of CryptoQuant facts it turned out that BTC’s foreign exchange reserve increased. This suggested that selling pressure on BTC was high.
Additionally, the aSORP turned red, meaning more investors were selling at a profit at the time of writing. In the middle of a bull market, this could indicate a market top.
Source: CryptoQuant
As BTC bears continued to push up the price of the king of cryptos, a key indicator pointed to a possible trend reversal.
Ali, a popular crypto analyst, recently posted one tweet It highlights that BTC showed bullish divergence against the RSI in the lower time frames.
The TD sequential, yet another prominent indicator, marked a buy signal, indicating a price increase. At the time of writing, BTCs Fear and Greed Index had a score of 37%, meaning the market was in a “fear phase.”
When the measure reaches this level, it suggests that the likelihood of a price increase is high.
Read Bitcoins [BTC] Price prediction 2024-25
AMBCrypto then checked Glassnode’s data. We found that despite the recent sell-off, BTC’s accumulation trend score had a value of 0.99.
A number close to 1 indicates that investors are considering accumulating more, which is generally considered bullish.
Source: Glassnode