Bitcoin Faces Resistance at $30,000 Level
Bitcoin has experienced a significant rally, approaching the $30,000 mark. However, on-chain data suggests that this level could pose a major resistance for the cryptocurrency.
1.49 Million Addresses Bought Around the $30,000 Level
According to market intelligence platform IntoTheBlock, the most significant potential resistance for BTC is at the current levels. This resistance is based on on-chain data rather than technical indicators.
On-chain levels are determined by the concentration of investors or addresses that bought Bitcoin at specific price points. The chart shows the distribution of holders across different levels of the asset.
The Impact of Investor Behavior
The behavior of investors at different price levels can impact Bitcoin’s movement. If holders bought their coins at a certain price and are currently in profit, they may be more inclined to sell if the price retests that level.
Conversely, if the price declines towards their acquisition price, they may buy more Bitcoin, expecting it to be profitable again in the future. The thicker the band of investors within a specific price range, the more pronounced these effects become.
The $29,800 to $30,700 Range
The range between $29,800 and $30,700 is particularly significant as approximately 1.49 million addresses bought their coins within this range. This suggests that Bitcoin could struggle to surpass this range as it has faced resistance in the past year.
However, strong support below this range indicates that Bitcoin could continue retesting until it eventually breaks through. Higher levels may not have much resistance since fewer investors have their cost basis there.
Rally Driven by Spot Buying
One positive sign for the current rally is that it is not driven by derivatives trading. The decline in open interest suggests that spot buying is fueling the price increase.
BTC Price
Bitcoin is currently trading around $29,900, within the range of major resistance discussed above.
Hot Take: Bitcoin Faces Resistance at $30,000 Level
Bitcoin’s rally towards the $30,000 mark has encountered a significant hurdle. On-chain data reveals that the concentration of investors who bought at this level creates a potential resistance for BTC. The range between $29,800 and $30,700 is particularly dense with addresses, making it challenging for Bitcoin to surpass this range. However, strong support below suggests that retesting may continue until a breakthrough occurs. The rally is driven by spot buying rather than derivatives trading, indicating a positive sign for the current price increase. Despite the resistance at $30,000, Bitcoin’s price remains within the range as it trades around $29,900.
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