Bitcoin Plunging: Is This The Best Time To Buy BTC?

Dalmas Ngetich

1 year ago

3 mins read

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Bitcoin is fast selling off. At spot rates, the world’s most valuable coin dropped by over 5% on the last day of trading and continues to spiral lower, easily breaking $60,000. The psychological round number has been level to watch out for over the previous few days, especially following gains over the weekend.

Bitcoin Is Down: Is It Time To Buy?

While Bitcoin is edging lower and sellers are relentless, one analyst thinks this is the right time to stack up. In a post on X, the analyst argues that Bitcoin is on the cusp of the “Spring” phase within the Wyckoff re-accumulation model.

Bitcoin might be preparing to spring higher | Source: @el_crypto_prof via X

The Wyckoff model is a technical analysis tool used by traders and chartists. Traditionally, it uses price and volume patterns to identify potential price movements.

While Wyckoff describes multiple phases when it comes to price patterns, the “Spring” stage is what most traders always track. When prices “spring” higher from this stage, the coin tends to break out from the current range at the back of rising trading volume.

Looking at the Bitcoin daily chart, it is evident that prices have been consolidating. Thus far, the primary support is around the May and June 2024 lows. Then, prices broke lower, sinking below $57,000 and bottoming at around $56,500 in May. Resistance lies between $72,000 and March 2024 highs on the upper end.

Bitcoin price trending downward on the daily chart | Source: BTCUSDT on Binance, TradingView

As it is, Bitcoin is retesting the primary support, with the July 4 bar piercing $60,000 and dropping to as low as $56,900 earlier today. Based on the Wyckoff model, prices are priming for the spring phase. This preview will hold, especially if there is no confirmation of today’s losses.

Miner Capitulating Though Long-Term Holders Are Not Selling

Though the analyst is upbeat, not everyone is bullish. According to Willy Woo, an on-chain analyst, the current sell-off is primarily driven by miner capitulation. Looking at the Bitcoin Hash Ribbons, the drop appears to be getting started as the market culls off “weak” miners.

Since the April 20 Halving, the Bitcoin network automatically slashed BTC rewards by half to 3.125 BTC. This automated move heaped more pressure on miners, who must invest capital to buy gear and operate efficiently. With falling revenue, only the most efficient miners stand a chance to operate profitably.

As a result, those who can’t upgrade their gear are forced to exit the scene. If they don’t, they stand operating without a chance of consistently winning block rewards. Over the last eight months, on-chain data shows that miners have been offloading BTC, countering the uptrend of Q1 2024 and worsening the correction from April.

BTC illiquid supply | Source: @Plamen__Andonov via X

Amid this, long-term holders, mostly institutions and whales, stopped selling in mid-January 2024. Then, the United States Securities and Exchange Commission (SEC) approved the first spot for the Bitcoin exchange-traded fund (ETF).

As proof, the Bitcoin “illiquid supply,” which shows the number of coins that haven’t been moved for over two years, is at a near all-time high.

Feature image from DALLE, chart from TradingView

Dalmas Ngetich

Dalmas, a seasoned crypto reporter, brings a unique perspective to the industry. His specialization in NFTs, blockchain, DeFi, and blockchain news for NewsBTC, combined with a background in mechanical engineering and over a decade of experience in journalism, has allowed him to craft over 10,000 news and feature articles over the past eight years. His diverse range of topics, including technology, Forex, and finance, reflects his comprehensive understanding of the crypto landscape.

His technical expertise and analytical skills have been recognized and featured by leading news outlets such as Investing.com, CoinTelegraph, Entrepreneur, Forbes, and other authority sites. Notably, he broke key news, including the Ripple and MoneyGram partnership, cementing his position as a thought leader in crypto.
The news exploded. Over 100,000 people devoured this meticulously crafted report, from seasoned investors to curious newcomers. His analysis wasn't just dry facts and figures; it crackled with insight, dissecting the implications of the partnership and its potential impact on the future of finance.

His deep understanding of the financial markets, technological advancements, and blockchain developments has made him a respected voice in the industry.

Dalmas is also the founder of BTC-Pulse, a crypto news site, further demonstrating his commitment to the field. He firmly believes that DeFi and NFTs are here to stay and will continue to drive financial inclusion.

Coming from Nairobi, Kenya, it is easy to see the source of his inspiration: Across Africa, millions lack access to traditional banks. Remote villages, limited documentation, and high minimum balances create insurmountable barriers.

DeFi, not just Maker or Aave, for example, but think of Bitcoin and USDT, cuts out the middleman. Forget banks with their limitations.
Even so, DeFi isn't a magic solution. The continent still struggles with reliable internet access, and educational campaigns highlighting the benefits of this wonderful solution are insufficient. Moreover, even for those interested, understanding DeFi can look like learning a new language.

Dalmas is here to help make the tech easy to understand and digestible, even for beginners.
The story of DeFi in Africa is still being written. Challenges abound, but the promise of a more inclusive financial future is a powerful motivator. With innovation and collaboration, Dalmas firmly believes that DeFi could become the key to unlocking Africa's full economic potential.
This possibility and its immense value motivate Dalmas to continue breaking key DeFi innovations and more across the globe. His engineering background further enhances his ability to deliver well-thought-out pieces that blend technical insight with clear, impactful reporting.

Beyond his professional achievements, Dalmas is deeply passionate about technology and politics. Policies drive adoption, and being at the forefront and keeping up with how they evolve is crucial for the sphere to mature.

When Dalmas is not closely monitoring the latest crypto events, he can be found in nature, exploring the picturesque countryside, and traveling with his family and friends. His love for adventure and discovery perfectly complements his investigative and reporting skills.
You can connect with Dalmas on X: @Dalmas_Ngetich, or contact him on Telegram @Dalmas_Ngetich.

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