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Price Performance
BTC is pulling back today, and in our main story below, we will look at some key support levels and how much further BTC could drop before resuming its bullish price action.
First, though, let’s zoom out and see if things are really all that bad.
Over the past 30 days, BTC price performance has been lacklustre. Currently down -2.59%.
Figure 1: Past 30-day performance.
Comparing BTC performance to some leading stocks and indices over that same period, there’s not much in it, with Tesla, S&P500, and Dow Jones all broadly flat along with BTC.
The one exception that has outperformed BTC as well as the others is Apple (AAPL), which is up +9% over the past month.
Figure 2: BTC relative performance over the past month.
However, when we zoom out to see how they compare over the past year, BTC is head and shoulders above the rest, having doubled in price. That’s worth remembering as everyone panics over the recent price drop.
Figure 2: Past 1-year performance of BTC versus majors.
The Big Story: How Low Can We Go?
Key Moving Averages
Although BTC price has dropped -7.5% from the fresh all-time highs that were set last week, it is still some distance from the key moving averages that BTC price typically interacts with as major support levels in bull markets.
Figure 3: Key bull market moving averages for BTC.
The first is the 128DMA, currently at $107,000. Then followed by the 200DMA at $100,000, followed finally by the 1-year moving average at $91,470. That is THE most critical moving average. Should BTC drop below that 1-year moving average level, then the bull market may well be over.
For now BTC price is still +8% above the 128DMA. However, as we discuss below, BTC does not even need to hit any of those moving averages before it continues its trend upwards. They are merely the key moving averages that would likely act as support should price drop further down.
Short-Term Holder Realized Price
Looking onchain, the Short Term Holder Realized Price highlights where short-term investors are in a loss. That occurs when price drops below the orange line on the chart below.
Typically in bull markets, that is where BTC price then reverses to trend back up higher.
It is an area of deep value in a bull market.
See the green boxes on the chart that show where BTC price has previously reached or dipped below Short Term Holder Realized Price (orange line).
Figure 4: Short-Term Holder Realized Price.
Each time, BTC has then rallied upwards after reaching or dropping just below the Short Term Holder Realized Price.
Currently, the Short-Term Holder Realized Price is at $108,662 and climbing. We would expect it to act as a broad area of support again if price dropped down to it.
Funding Rates
At Bitcoin Magazine Pro, we closely monitor funding rates across exchanges. We note that funding has been turning negative today on one of the major exchanges, OKX. This indicates that traders are becoming more bearish overall and are expecting prices to drop further.
In a bull market, this typically marks a major low before price rallies up higher, catching those traders out.
Figure 5: OKX Funding Rates for Bitcoin.
While this is only one exchange (funding remains positive on other exchanges) it does provide the bulls some hope that we may be close to BTC bottoming at current price levels.
So while the key bull market moving averages are some distance below current prices, we note that Short Term Holder Realized Price is at $108,000, and Funding Rates on some exchanges are already turning negative. This could indicate that we are not too far from BTC turning bullish once again.
You can track Funding Rates across major exchanges for free here.
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Speak again soon,
Bitcoin Magazine Pro Team.