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Breaking News: Bitcoin Price Tumbles Toward $98,000: What’s Driving The Drop And What Lies Ahead
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Breaking News: Bitcoin Price Tumbles Toward $98,000: What’s Driving The Drop And What Lies Ahead

Bitcoin Resistance: Here Are The Challenges Ahead For BTC

Keshav Verma
Keshav Verma
Last Updated: August 21, 2024 9:30 am
2 mins read
Bitcoin

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Bitcoin has certain on-chain resistance levels coming up that could threaten future rallies. Here are the exact prices at which they lie.

Bitcoin Short-Term Holders Have Their Cost Basis At These Levels Ahead

As explained by CryptoQuant author Axel Adler Jr in a new post on X, the BTC short-term holders currently have their cost basis levels between $62,000 and $65,000. The on-chain relevance metric here is the “Realized Price,” which keeps track of the average acquisition price on the Bitcoin network.

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When this indicator is above the cryptocurrency’s spot price, it means the average investor in the market is underwater right now. On the other hand, it being below BTC’s value suggests the dominance of profits on the network.

In the context of the current topic, the Realized Price of the entire userbase isn’t of interest, but only that of a specific segment of it called the short-term holders (STHs). The STHs refer to the investors who bought their coins within the past six months.

This Bitcoin cohort has historically acted erratically, easily selling whenever a major change in the market has occurred, like the emergence of a rally or crash.

Below is the chart shared by the analyst that shows the trend in the Realized Price of the STH group, as well as that of a few subdivisions of it, over the past year:

Bitcoin Short-Term Holder Realized Price
Looks like the asset has recently been under all of these levels | Source: @AxelAdlerJr on X

As is visible in the above graph, the Bitcoin STH Realized Price is currently around $64,000, which means these investors are in a state of net loss. The Realized Price broken down for each segment of the cohort reveals the STHs who bought between 3 and 6 months ago are in the deepest loss as their cost basis is at $65,800.

The 1- to 3-month investors are close to the average of the whole cohort, with the metric being $64,200. The most recent buyers (1 week to 1 month) are in the best position as they acquired their coins at an average cost of $62,400 per token.

To any investor, their cost basis is naturally an important level, but the STHs especially can be sensitive to retests of it. Thus, if the price rallies to one of these levels, then it’s likely that these holders will produce some reaction.

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However, as the STHs are currently carrying a loss, they may be looking forward to the retest so they can sell and get their investment back. As such, Bitcoin could feel some resistance when it travels up to these Realized Price levels.

BTC Price

Bitcoin had risen above the $61,000 level but appears to have seen a sharp retrace since then, as its price is already back at $59,000.

Bitcoin Price Chart
Looks like the price of the coin has already retraced its latest recovery | Source: BTCUSD on TradingView
Featured image from Dall-E, CryptoQuant.com, chart from TradingView.com
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Keshav Verma
Keshav Verma

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

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Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
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