Has the Decline in Cryptocurrencies Ended? Glassnode Explains!
Has the decline in the price of Bitcoin come to an end? On-chain data provides strong signals. Just as historical data warned about the increase in volatility this week, the same models are giving many signals about the current situation. Although it does not predict the future, it can be useful to look at on-chain readings as they have a high success rate.
Has the Decline in Cryptocurrencies Ended?
It would be wise to examine the situation of Bitcoin especially after completing the week of decline. Measurements reveal how recent events have affected the accumulation and demand of BTC. The number of addresses in profit or loss is an important measure for Bitcoin analysts. It provides a rough estimate of how investors were affected by the recent downturn conditions. It can also be used to evaluate the impact of selling pressure.
According to a recent Glassnode report, the number of Bitcoin addresses in loss has reached a new monthly high. This means that Bitcoin’s breakeven point is above the current level and confirms the short-term focus. Meanwhile, the BTC supply, which has been active for more than 10 years, has reached a new ATH level.
Based on the above ATH signal, the decline may have ended in the short term.
Will Cryptocurrencies Rise?
When we dig deeper, we see that the number of addresses in loss has reached a new monthly high. These findings do a great job of determining the magnitude of the downward impact on BTC holders. However, these findings do not emphasize the result after the crash. Perhaps evaluating the whale activity in Glassnode can provide an idea of what the market’s next move will be.
The number of addresses holding more than 1,000 and 10,000 BTC has significantly decreased. This confirms that Bitcoin whales contributed to the selling pressure between August 14-17.
The recent findings also support the view that the decline in the first section has ended as whale sales have also calmed down. So will the rise begin? When it comes to accumulation, Bitcoin’s exchange flow data shows that the amount of BTC flowing out of exchanges outweighs the inflows. The net flow of coins from exchanges to private wallets is an indication of accumulation. On the other hand, we have seen a massive decrease in open interest, which remained calm at the bottom along with the price. The increase in open interest in the coming days may be a strong leading signal for the price to rise again.
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