Bitcoin (BTC) Dips Below $28,000: Here’s What You Need to Know
Bitcoin Struggles to Surpass $28,000
Bitcoin recently managed to recover above the highly sought-after $28,000 level, reaching a high of $28,288 on October 6. However, in the days that followed, it struggled to surpass the critical $28,110 mark, oscillating near the $28,000 level. This inability to break through hindered the price advance of Bitcoin.
Blockchain Analytics and the Bitcoin Price
A blockchain analytics start-up sheds light on the recent Bitcoin price movements. It reveals that the rise to $28,000 was partly triggered by certain factors while also impeding further price growth. One of these factors was the significant movement of over 10,000 BTC off exchanges since September 7, as Bitcoin made strong efforts to stay above $28,000.
Positive Sign: Tokens Moved Off Exchanges
When tokens are taken off exchanges, it can be seen as a positive sign. This suggests that investors are transferring their coins to cold storage, indicating no intention of selling. According to Santiment, Bitcoin experienced its largest exchange outflow in a month, with the supply of Bitcoin on exchanges falling to 5.68%, the lowest since 2017.
The Missing Ingredient: Utility
Despite the efforts of the bulls, there was one missing ingredient to fuel further bullish action: utility. Utility plays a vital role in a bullish Bitcoin move. Analysts often observe a positive correlation between increasing on-chain activity and the price of Bitcoin. However, Bitcoin’s unique addresses are currently at a six-week low, with Bitcoin active addresses at 862,000, the lowest since August 26.
The Current Market Environment
At the time of writing, BTC was down 1.21% in the last 24 hours, trading at $27,517. The crypto market, including Bitcoin, is facing high instability, resulting in a loss of ground in early Monday trading. Bitcoin must remain above $27,000 to prevent the formation of bearish momentum. If it falls below $26,700, a retest of the $26,000 mark becomes a possibility.
Trading Range and Future Scenarios
A plausible scenario is for Bitcoin to remain within its current trading range of $27,000 to $27,500. However, there is a possibility of negative or positive scenarios, with Bitcoin reaching $26,700 or $27,800 respectively. The market environment remains uncertain, and traders should closely monitor these price levels.
This article was originally published on U.Today
