Bitcoin Price Eyes $70,000 Rebound As On-Chain Metric Hints End of Correction
Bitcoin price prediction indicates reduced volatility over the weekend, as seen by Doji candles on the daily chart. The easing selling pressure has stalled the correction trend in altcoins, with many revisiting their crucial monthly support levels. However, with BTC experiencing continuous outflows from the U.S. listed ETFs and miners capitulating, selling pressure could potentially drive the asset below $60,000.
Bitcoin Price: SOPR and Flag Pattern Hint at Potential Bullish Breakout
Bitcoin's price correction started in the second week of the month when the price fell from $72,000. The price has dropped 10.7% to $64,275, and the market cap has reduced to $1.267 trillion. Moreover, Bitcoin miners have sold over 30,000 BTC, which is around $2 billion since June, according to crypto analytics firm IntoTheBlock. This sell-off is the fastest in over a year and is a direct result of the recent Bitcoin halving, which has reduced miners' profit margins, forcing them to sell more of their holdings.
This reduction in mining rewards, along with the increasing operational costs, has put financial pressure on miners, making them sell their Bitcoins to cover expenses.
However, an analysis of the daily chart shows this correction as part of a sideways trend from the flag pattern. The two trendlines, acting as dynamic resistance and support, are the key factors influencing BTC price movement. If the pattern holds true, the current sideways consolidation is just a phase before the coin starts to recover after breaking the resistance.
Furthermore, CryptoQuant’s analyst, Axel Adler Jr., has pointed out that the Spent Output Profit Ratio (SOPR) for short-term holders, based on a 90-day moving average, has fallen below 1.0. This could signal the end of the current market correction and the start of a new bullish trend. The SOPR measures the profit and loss of Bitcoin holders. A value below 1.0 indicates that people are selling at a loss, often a sign of a market bottom and potential reversal.
Thus, with a broader bullish trend, BTC is likely to break the flag pattern with a decisive breakout. A successful breach will set the recovery target to $89,150, with the possibility of an extended rally to $135,000.
Technical Indicator
- EMAs: A bearish crossover between the 20 and 50-day Exponential Moving Average supports the prolonged correction in BTC.
- Average Directional Index (ADX): An uptick in the daily ADX slope at 21% highlights that sellers are strengthening their grip on this asset and continue as the dominant force.
This Bitcoin price prediction and technical analysis suggest that while the market is currently facing selling pressure, there are indicators that a bullish breakout could soon initiate a significant recovery.
