Bitget App
Trade smarter
Buy cryptoMarketsTradeFuturesCopyBotsEarn
Bitcoin breaks through $44,000, but analysts see increasing risk of price correction

Bitcoin breaks through $44,000, but analysts see increasing risk of price correction

The BlockThe Block2023/12/20 15:42
By:Brian McGleenon

Bitcoin increased by over 4% to break through the $44,000 mark for the first time in over a week.But the risk of a price correction is increasing, according to Coinglass analysts.

Bitcoin breaks through $44,000, but analysts see increasing risk of price correction image 0

Bitcoin BTC +3.83% broke through the $44,000 mark for the first time in more than a week on Wednesday, rising by 4% over the past 24 hours. Coinglass  data shows the break-out caused over $33 million in BTC short liquidations in the past 24 hours.

However, according to analysts, the largest digital asset by market cap could experience increased sell pressure because a super majority of circulating supply is now in profit.

"As the market rallies, a super-majority of investor coins have returned to being in-profit," Coinglass analysts said in the new report .

Bitcoin has broken through the $44,000 mark, according to The Block's Prices Page.

Coins held 'in-loss'

The Coinglass analysis pointed to data that showed how the total volume of coins held "in-loss" has declined to around 1.9 million bitcoin, with most held by long-term holders who bought near the 2021 highs.

The data from Coinglass concurs with that from The Block's Data Dashboard which shows that the percentage of bitcoin circulating supply that is in profit is now over 88%. That's a high not seen since late November 2021.

"2023 started out with over 50% of bitcoin supply being underwater, this is one of the fastest recoveries in history, second to the rally in 2019," Coinglass said.

A Coinglass chart showing the total amount of bitcoin supply in loss.

Sell pressure

A recent CryptoQuant report also suggested sell pressure is increasing for the digital asset.

"In the short-term, there are some risks of a price correction given that short term bitcoin holders are experiencing high unrealized profit margins, which historically has preceded price corrections," the report said.

However, the report highlighted longer-term bullish indicators for 2024.

"On-chain valuation and network metrics signal bitcoin remains well inside a bull market and may be targeting $54,000 in the medium term and $160,000 plus as this cycle price top," the CryptoQuant report added.

 


0

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

PoolX: Locked for new tokens.
APR up to 10%. Always on, always get airdrop.
Lock now!

You may also like

Visionary or 'financial comedy'? Market participants weigh MicroStrategy's stock premium amid bitcoin buying spree

MicroStrategy, with a market cap of around $85 billion, currently holds 331,200 bitcoin worth about $30 billion.The stock’s 440% year-to-date surge has baffled some financial pundits, while others have cheered its corporate strategy.

The Block2024/11/26 19:44

Congress’s top priorities this lame duck session

Here’s a look at what lawmakers are most focused on in these final weeks of the 118th Congress

Blockworks2024/11/26 18:33

BTC breaks through $94,000

Cointime2024/11/26 16:55