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Bitcoin Network Sees Rising Profit-taking As BTC’s Price Shows Signs Of Weakness
After holding above the $107,000 price mark for several days, Bitcoin has finally fallen below this crucial resistance level, leading to a bearish movement towards the $105,000 threshold as Tuesday came to a close. The sudden pullback is being accompanied by a significant surge in profit-taking activity among investors.
The recent upward momentum of BTC’s price growth has slowed down due to waning market sentiment. On the other hand, the Bitcoin network is witnessing a substantial resurgence in profit-taking, which appears as the price of BTC begins to fluctuate following an impressive rally.
Glassnode, a well-established on-chain data analytics firm, reported that the amount of realized profits rose to $2.4 billion on Monday. Furthermore, Glassnode noted that the 7-day Simple Moving Average (SMA) has climbed to a value of $1.52 billion.
According to the platform, the swelling profit-taking activity observed on the Bitcoin network could be indicative of investors seeking to lock in gains before prices decline further. This trend is accompanied by falling prices and implies that many investors are attempting to minimize their potential losses.
Data from Glassnode reveals that the 7-day SMA realized profits have surpassed the Year-To-Date (YTD) average of around $1.4 billion, but this figure remains far below the $4 billion-$5 billion peaks seen in November and December last year. Such elevated figures may signify a cautious sentiment among BTC investors.
Many traders are no longer encouraged to hold onto their coins due to waning price performances, implying that the market has entered a precarious situation. If profit-taking continues, this could hinder any potential bullish attempts, triggering a correction towards key support levels of $100,000 or even lower.
The ongoing surge in realized profits on the Bitcoin network is dominated by short-term holders, also known as retail traders.
Source: bitcoinist.com
