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Bitcoin’s price action in the past 48 hours has seen it approaching the $80,000 price level again, with risks of breaking to the downside. Looking at on-chain data shows a notable support level between $80,920 and $78,000 that must not be broken.
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Particularly, on-chain analytics from Glassnode point to a thinning of support at the $78,000 level, where only minimal cost basis clusters now exist. The insight follows a sharp move that saw savvy traders scoop up nearly 15,000 Bitcoin at the March 10 low before cashing out at the $87,000 local top.
Support Cushion Rises With Clusters Between $80,000 And $84,000
Bitcoin started the month of March with a crazy crash that saw its price hit below $77,000 on March 10 and March 11. Most of the month was spent by Bitcoin embarking on a recovery from this level, eventually reaching as high as $88,500 last week.
Interestingly, on-chain data from Glassnode shows that some Bitcoin traders took advantage of the crash and bought about 15,000 BTC at this low. However, many addresses from this same cohort sold at the $87,000 local top, leaving behind a depleted buffer zone that may no longer offer the same price stability.
Bitcoin’s strongest cost basis clusters have steadily migrated upward from $78,000 throughout the month, with the most prominent support levels now sitting between $80,920 and $84,100. Approximately 20,000 BTC were acquired at $80,920, 50,000 BTC at $82,090, and another 40,000 BTC at around $84,100. These fresh accumulations are now the new zones of confidence among recent buyers that may offer cushions for the recent market dip.
At the time of writing, Bitcoin is trading at $83,120, meaning that it has lost the zone of 40,000 BTC around $84,100. This puts the onus on $82,090 and, subsequently, the $80,920 price levels. However, if the correction sharpens further, it wouldn’t be until after $78,000 that structural support reappears at $74,000 and $71,000, where long-term conviction buying occurred, estimated at 49,000 BTC and 41,000 BTC, respectively.
Image From X: Glassnode
$95,000 Cost Basis Cluster Grows With Cooling Demand
As support continues to climb gradually, resistance appears to be firming near the $95,000 mark. Investor cost basis data shows an increase of 12,000 BTC clustered at this level since March 24.
This implies that some investors now anticipate a top forming around $95,000, and selling activity could become more pronounced if prices approach that zone. This resistance, alongside the support levels, could see Bitcoin confined within a narrowing range in the short term.
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Glassnode data confirms that long-term holders (addresses holding Bitcoin for more than 150 days) have been the primary source of profit-taking for a while. Long-term holders’ profit-taking is now nearly matched by the losses endured by short-term traders who have been holding Bitcoin for less than 155 days.
Image From X: Glassnode
Featured image from Tech Research Online, chart from TradingView