Bitcoin (BTC) is currently experiencing renewed downward pressure as it struggles to stay above the $115,000 mark. As of the latest updates, the cryptocurrency is trading at approximately $115,745, reflecting a decline of about 2.2% over the past 24 hours and nearly 6% below its record high of $123,000 reached in July. This recent market activity has sparked concerns regarding short-term price stability, particularly due to the perceived lack of robust structural support in the current trading environment.
Recent insights from the on-chain analytics platform CryptoQuant indicate a shift in investor behavior, particularly among short-term holders. Although long-term investors generally remain profitable, the sentiment among those trading in the short term appears to be changing. An analysis by contributor Darkfost on CryptoQuant’s QuickTake platform highlights the significance of Bitcoin Unspent Transaction Outputs (UTXOs), which track coins being spent either at a profit or a loss. The analysis reveals that many investors are becoming reactive to even minor price drops, suggesting an increase in market uncertainty.
Darkfost noted that the UTXO data illustrates broader market sentiment, emphasizing that the focus on transaction counts rather than monetary value helps eliminate price-related noise. Historically, Bitcoin has seen a predominance of UTXOs spent at a profit, with long-term holders benefiting from price appreciation. However, recent trends show a decline in the ratio of profitable UTXOs compared to those spent at a loss, dropping from a peak of over 10,000 to around 500. This shift indicates that some investors are now liquidating positions at a loss, even during minor price corrections, which could signal short-term selling pressure despite the overall profitability for many holders.
Additionally, another analyst from CryptoQuant, Maartunn, has pointed out structural vulnerabilities in Bitcoin’s recent price movements. On July 10, BTC saw a rapid surge from $112,000 to $115,800, but this climb left minimal on-chain support at those levels. Maartunn remarked that the speed of the ascent did not allow for the formation of any substantial support levels. He cautioned that if this final support area fails, the price could quickly decline, as no prior resistance or consolidation exists to provide stability.
With Bitcoin now hovering just above its last known on-chain support zone, analysts warn that a breach of this level could lead to an accelerated decline in price. The current market landscape suggests that traders should remain vigilant as conditions evolve.
