Bitcoin short sellers are going to go gaga after reading this
The king of cryptocurrency, Bitcoin [BTC]suffered a massive drop in price in June when the crypto market crashed, marking a 2022 low of $18,154.
Soon after, however, the coin had a steady upward trend for the next two months. BTC also managed to cross the $24,000 mark, giving hope for a massive bull run soon.
But with the latest developments, the situation may witness a change.
At the time of writing, BTC was trading below the $24,000 mark, at $23,491, with a market capitalization of $449,275,521,406.
Source: CoinMarketCap
What’s up?
A Chicago-based investor CryptoWhale with 533.8k followers on Twitter recently tweeted that it expects a Bitcoin market crash.
According to the Twitter handle, a bearish divergence was forming on BTC’s charts, suggesting that a drop in price was around the corner.
While many had differing opinions, most Twitter users seemed to agree with CryptoWhale.
#Bitcoin Incoming crash 🐳 pic.twitter.com/W4eiAnLtkT
— CryptoWhale (@CryptoWhale) 17 August 2022
But interestingly, a few calculations highlighted the exact opposite of CryptoWhale’s prediction.
Glassnode’s data showed that Bitcoin’s balance on exchanges reached a four-year low, indicating investors’ conviction to HODL.
Source: Glassnode
However, Bitcoin’s number of addresses with a balance ≥ 0.01, which was on a constant upward trend, showed a decline recently.
Source: Glassnode
To add to the aforementioned data, last week, the percentage access to Bitcoin profits also started to increase, giving investors hope.
BTC’s percentage of profit reached a three-month high of 62.03% on August 12.
Source: Glassnode
Well, a look at BTC’s chart showed that after being in a gradual uptrend, the coin followed the selling pressure after August 15 when it failed to break the resistance at the $24,000 mark.
Several indicators, including the Relative Strength Index (RSI), Chaikin Money Flow (CMF) and Exponential Moving Average (EMA), hinted at bearish market conditions, further increasing the possibility of a downtrend in the coming week.
While Bitcoin’s price increased over the past week, a bearish divergence was seen on the CMF (blue trend line).
Source: TradingView
Also, a bearish wedge pattern formed on BTC’s chart, indicating a fall. Therefore, considering the chart and calculations on the chain, traders must be careful before making any moves.
