After performing a rollercoaster over the past week, Bitcoin had a bit of price stability over the weekend. With the focus on rising tensions in the Middle East, it has been a bit difficult to determine the future trajectory of the crypto market.
However, the technical structure and the chain of the prime cryptocurrency show that the bear market is still fully active. In fact, the latest evaluation of the chain shows that the price of Bitcoin is still vulnerable to low volatility.
Is BTC price preparing for another round of bearish moments?
In a new message on the X platform, the chain analyst Boris stated that the price of Bitcoin remains in the market structures, which will eventually lead to lower movements. This observation is based on the increasing active long-term supply (LTH) ratio, which indicates the increasing level of activity within the LTH supply.
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According to Boris, volatility typically occurs within the long-term supply chain before major price moves. This stage is characterized by the strategic allocation of Bitcoin to the right places in preparation for market activity.
Boris said:
As the market grows, these coins are gradually distributed to meet demand. When demand begins to weaken, the market typically moves into a sideways structure, allowing the distribution process to continue.
Currently, the Bitcoin market tends to go lower after the distribution phase is completed and new positions are established. For example, since the beginning of this increase in LTH activity, the price of BTC has decreased from about $95,000 to about $60,000.
Interestingly, the decline in Bitcoin price has not restored the upward trend of long-term holders, which means that a downward movement is still a big possibility. “Even if we see upward moves in the coming weeks, they will likely represent an illusion of liquidity in the broader distribution phase,” Boris said.
The analyst noted that although the range of $60,000-$62,000 appears to be a support zone, the current market structure suggests that this zone can only act as a liquidity generating zone during the redistribution phase. A liquidity generation zone (or liquidity zone) typically refers to a key technical area with a concentration of trade orders, typically stop losses and limit orders.
Boris concluded that based on the available evidence, a downward price movement at the end of the year is the most likely scenario for Bitcoin.
Bitcoin price at a glance
As of this writing, the price of BTC is around $67,628, reflecting a 1% decline in the last 24 hours.
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Featured image from iStock, chart from TradingView
