Bitcoin has been steadily rising over the past week. In fact, its latest bullish trend has allowed the king coin to surpass $68,000 on its price chart. However, the prevailing trend may soon change, albeit for a short period of time. This seems to be the case, especially as bearish divergence appears on the Bitcoin price chart.
Bitcoin's Main Strengths
According to CoinMarketCap, the cryptocurrency's price increased by more than 9% last week, sending it soaring above $68,000. AMBCrypto previously reported on several developments that may have played a major role in BTC's latest rally.
For example, the supply of Bitcoin held on exchanges has dropped to a five-year low. This clearly means that buying sentiment is dominating the market – implying a price increase.
Additionally, AMBCrypto also reported on BTC Open Interest surging. To be exact, Bitcoin Open Interest hit a record $20 billion, just 8% below its ATH. Whenever the metric increases, it means that the likelihood of the ongoing price trend continuing is high.
Satoshi Club, a popular X account that shares crypto-related updates, recently tweeted out another important development. According to it, the supply of BTC held by addresses that purchased in the past 12 months is now at a 2-year high. This trend has accelerated recently as ETFs have seen $2.1 billion in inflows over the past five days.
However, not everything is going in favor of the king coin. Ali, a popular cryptocurrency analyst, shared a tweet, mentioning a bearish divergence. This indicates that there is a possibility of a short-term price correction here. Therefore, it is worth taking a closer look at the current situation of Bitcoin.
Is a Price Adjustment Inevitable?
AMBCrypto’s analysis of CryptoQuant’s data revealed some pretty interesting metrics. For example, the king coin’s binary CDD is green, meaning that the movement of long-term holders over the past 7 days has been lower than average. They have an incentive to hold their coins.
However, aSORP suggests that many investors have been selling to take profits. In the midst of a bull market, it can indicate a market top. Furthermore, NULP is also bearish because it indicates that investors are in a period of confidence when they have high unrealized profits.
Finally, we look at Bitcoin’s daily chart to find potential support levels as the coin corrects. According to our analysis, a price correction could see BTC fall back to $66,000. A drop below that level could push the coin down to $62,800.
