Weak address growth points to Bitcoin price failing to sustain $25K
Bitcoin (BTC) is staging a repeat of the price action from May with its latest drop, the latest data shows.
As the dust settles on a 6% drop for BTC/USD, analysis claims the trip to $25,000 was never meant to last.
Realized price returns to haunt the BTC chart
After surprising some with its size, the latest BTC price action snap losses are still playing out.
After falling from $23,800 to as low as $21,400 in a single hour, the largest cryptocurrency is now trying to establish support near its realized price.
At just below $22,000, realized price refers to the sum to which the entire BTC supply last moved.
The setup will be more than familiar to many market participants, as realized price formed an initial support line during Bitcoin’s descent in May, immediately after the Terra LUNA blowout.
With history rhyming – at least on the chart – it remains to be seen whether other recent points of interest will continue to play their part.
Among them is the 200-week moving average (MA), a hard-won support level in July that has now seemingly been lost in one fell swoop.
The 50-day MA, approved at the end of July, is now also back above the spot price of $22,260.
#Bitcoin made a nice relief rally in the last 2 weeks, but bearish #RSI divergence has always been in the background.
$22k was high in June and now #50DMAwhich seems to hold as support so far
If #BTC breaks below $22k again, I think it’s likely we’ll see the low $18k again. pic.twitter.com/0xwArqUcUN
— venturef◎undΞr (@venturefounder) 19 August 2022
Going into the Wall Street open, US stock futures showed more downside to come, meaning more pressure on crypto markets.
Active addresses do not support breakout
A look at the growth in network activity in August ran to over $25,000, while yielding bearish conclusions for analyst Philip Swift.
Related: Bitcoin ‘liveliness’ lowest since 2021 amid new 5-year BTC hodl record
In a recent tweet on the day, the creator of the analysis resource Look Into Bitcoin noted that the address growth had not matched similar price increase phases this time.
“AASI (Active Address Sentiment Indicator) has indicated that the current price movement has not been supported by a sufficient increase in active addresses on the Bitcoin network,” he summarized.
“Experienced local highs when this has happened in the past.”
This comes despite the total number of Bitcoin addresses ever created passes 1 billion this week, according to data from the chain analysis firm Glassnode.
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