Is a New Bitcoin Drop Coming Due to STHs?
Currently trading around $70,000 after a slight decline over 24 hours, Bitcoin is facing a real selling wall. According to recent data, Short-Term Holders (STHs) have transferred more than 48,000 BTC to exchange platforms in a single day. This represents an annual record for profit-taking that is abruptly halting the ongoing rally.
Faced with macroeconomic uncertainty, these traders prefer to secure their gains on each rebound rather than aim for new highs. This short-term bearish dynamic mechanically caps the price increase, creating a significant friction zone. Investors are now wondering whether the market has the necessary liquidity to counter this massive supply.
Indeed, the SOPR chart indicates a return of short term holders to the short-term profit zone. If we compare the current trend to that of the previous bear market, each return to the green zone has constituted a local top before a new drop.
Is Bitcoin’s Key Support in Danger?
From a technical analysis perspective, this wave of profit-taking creates a major obstacle for the cryptocurrency. The data highlights that Bitcoin is facing heavy resistance near $84,000. As long as this zone is not broken through with convincing volumes, the risk of a severe retracement remains particularly high.
However, not everything is gloomy for the crypto market. Billions of dollars in inflows via Spot Bitcoin ETFs and stablecoins continue to flow into the market. This fresh capital acts as an institutional safety net and could absorb the current selling pressure before it breaks critical support levels.
If buyers regain control of the order book, a breakout above current levels would restart the bullish machine. Conversely, if liquidity runs short, buyers will have to defend the lower zones tooth and nail to avoid a trend reversal.
Is This the Right Time to Buy Bitcoin Before a New Rally?
The tug-of-war between massive retail profit-taking and institutional inflows will dictate the next major trend. Sentiment indicators show that risk appetite remains limited, pushing many players to extreme caution.
Nevertheless, history has often proven that these moments of STH profit-taking constitute a solid barrier. Bitcoin could return to the massive demand zone and order block around $67,000 now that it has reintegrated its range. A break below $70,000 would confirm this bearish scenario.
Subsequently, trader Killa announces about ten days of consolidation above $66,000 before a bearish continuation below 60K in the coming weeks with a bottom in July. To be continued.
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