Bitcoin

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Bitcoin experiences the “deepest correction” in 24 months, impacting the short-term holders (STHs) with unrealized losses, according to onchain data from Glassnode.&nbsp;
Data from <a href="https://subscription.cointelegraph.com/?_gl=1*7499wx*_ga*MTQ0MzQ0NzI4Ny4xNzE2MzY1NTA0*_ga_53R24TEEB1*MTcxNjM2NTUwNC4xLjEuMTcxNjM2Njg2MC4wLjAuMA..">Cointelegraph Markets Pro</a> and <a href="https://www.tradingview.com/symbols/BTCUSD/?exchange=BINANCE" target="_blank" rel="noopener nofollow">TradingView</a> reveals that in the latest drawdown, the price of Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) dropped by more than 16.5% from a high of $63,801 on July 1 to set a swing low at $63,499 on July 5 in what Glassnode describes as the “deepest correction since late 2022.”
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 “Between May and July, the market experienced its deepest cycle correction, recording a drawdown exceeding -26% from the ATH.”
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 <img src="https://s3.cointelegraph.com/uploads/2024-07/6ada4d55-8185-4d91-b9cf-fb24152602aa.png" alt="Bitcoin traders ‘under pressure’ after deepest correction since 2022 erases profits" title="">
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 Bitcoin price performance. Source: Glassnode
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Despite this downturn, Glassnode’s The Week Onchain newsletter reports that the correction is notably shallower than past cycles. It points to a strong market structure and “reduced volatility as Bitcoin matures as an asset class.”
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 “If we assess price performance relative to each cycle low, the 2023-24 market has behaved eerily similar to the last two cycles (2018-21 and 2015-17). The reason for Bitcoin following such a similar path is a regular topic of debate, but it continues to provide a valuable framework for analysts to think about cycle structure and duration.”
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Glassnode analysts found that with the sell-off, 83% of the supply controlled by short-term holders — addresses that have held Bitcoin for less than 155 days — has fallen into unrealized losses. 
According to the chart below, 2.9 million BTC (approximately $166.75 billion at current rates) of the 3.2 million BTC ($184 billion) held by STHs were <a href="https://cointelegraph.com/news/bitcoin-price-short-term-holder-crypto-quant-analysts">pushed below their cost basis</a> with the recent sell-off to $53,000. 
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 <img src="https://s3.cointelegraph.com/uploads/2024-07/806ce7fd-7a34-4114-b70c-28909e67a9d0.png" alt="Bitcoin traders ‘under pressure’ after deepest correction since 2022 erases profits" title="">
 <figcaption style="text-align: center;">
 Bitcoin STHs supply plunges into loss. Source: Glassnode
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According to Glassnode analysts, this placed significant pressure on Bitcoin and the broader crypto market. 
As long as the BTC price remains below $58,000 for the next few days, the long-term outlook for <a href="https://cointelegraph.com/learn/what-is-bitcoin-a-beginners-guide-to-the-worlds-first-cryptocurrency">Bitcoin</a> price will remain bearish as this level acts as a significant resistance zone.
At the time of publication, Bitcoin was trading at $57,485 and was fighting stiff resistance in its recovery path compared to the support it enjoyed on the downside.
The chart below corroborated this, showing that the 200-day exponential moving average (EMA) at $58,180 posed the first resistance line for the bulls. Another barrier could emerge from the $63,880 level, where the 50-day and 100-day EMAs appear to converge.
Aggressive selling from this supplier congestion zone may curtail any attempts to push the price higher as investors book profits or break even.
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-07/66065105-16fe-45b8-a9ec-af962b8adf69.png" alt="Bitcoin traders ‘under pressure’ after deepest correction since 2022 erases profits" title="">
 <figcaption style="text-align: center;">
 BTC/daily chart. Source: TradingView
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Popular analyst Daan Crypto Trades observed that reclaiming the 200-day EMA and holding above $59,000 would be a “good start” for Bitcoin bulls. 
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-07/03211923-c77b-4ad8-8569-144f0331e05b.png" alt="Bitcoin traders ‘under pressure’ after deepest correction since 2022 erases profits" title="">
 <figcaption style="text-align: center;">
 Source: <a href="https://x.com/DaanCrypto/status/1811068614323388901" target="_blank" rel="noopener nofollow">Daan Crypto Trades</a>
 </figcaption>
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Liquidation data from CoinGlass shows high short bids building up near the 200-day EMA at $58,587, asserting the importance of this level.
<figure data-ct-non-breakable="true">
 <img src="https://s3.cointelegraph.com/uploads/2024-07/4464ed82-e750-4ade-b458-e787034c2f6e.png" alt="Bitcoin traders ‘under pressure’ after deepest correction since 2022 erases profits" title="">
 <figcaption style="text-align: center;">
 Bitcoin liquidation heat map. Source: CoingGlass
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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Bitcoin traders ‘under pressure’ after deepest correction since 2022 erases profits

Cointelegraph

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