Crypto Market Analysis (4-August-2022)

Onchain Analysis

Bitcoin

Long-Term Holder SOPR

LTH SOPR Aug 4

Few moments in Bitcoin’s history equal the current moment where most long-term holders (UTXO aged 155 days+) are selling at a loss.

When this happens, it is an excellent opportunity to Accumulate BTC, as many of these holders were at high base cost and held Bitcoin hoping for a new ATH. Now they are almost forced to sell due to the seller movement in the BTC price and the unstable and contractionary macroeconomic situation.

LTH SOPR 2 Aug 4

In 2015-2016 during the bear market, the SOPR LTH indicator remained about 400 days below the 1.00 value, which means that UTXOs considered Long Term was spent at a loss compared to the realized price. While in 2018-2019, the indicator signaled sales at a loss for approximately 330 days. As the price recovered, these holders mostly returned to selling at a profit.

It has been about 65 days since long-term holders began selling at a loss, indicating good Accumulation momentum for those with cash on hand and risk management in place.

Technical Analysis

4-Hour Time Frame

BTC 4H Aug 4

The question remains: is $24k just a local top or Major Resistance for the price in the short term?

Part of that answer was given in the last price test at $20.8k (as expected and passed in the previous Analysis). In contrast, the other part is trapped within the region the price is currently in.$22.4k is the crucial point for the very short term where the price needs to hold as Support for $24k to be just a local top.

The bullish structure cannot be broken; if that happens, the odds will reverse dramatically. The price action will always indicate the most significant probability of the next move. Where is the bullish structure compromised? Below $22.4k, if broken and becomes Resistance, the price will advance in search of a retest at $20.8k. This will not be healthy for the bullish structure as $20.8k has been set as Support recently.

In the current configuration, with the price respecting $22.4k as Support after successfully testing the $20.8k range, the highest probability is the breakout above $24k with advancing price action performing consecutively higher tops and bottoms.

Daily Time Frame

BTC Daily Aug 4

After the breakout of $24k, if following the current probability, the first target for the price is $27.5k (last fight point), which will define the next price move. If this point is broken with determination, the target to follow is $30.9k (Price support for over one year) and the catalyst for the last bearish price action. Therefore, $24k remains the main point to break for there to be a real possibility of a bottom in the price to reverse the primary trend, which is still down.

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I am Gabriel Cordeiro (aka Gaah), Capital Manager and Crypto Trader, On-chain Data and Technical Analyst, and Verified CryptoQuant Author. This is my Twitter link: http://Twitter.com/gaah_im