- Bitcoin dips below the critical $27k support level, but bullish momentum still exists in the longer frame.
- On-chain metrics suggest an accumulation phase since late July, despite short-term bearish sentiment.
Despite Bitcoin’s recent slump below the $27k threshold on 11 October, many traders showcased their unwavering faith by going long. This audacious move was corroborated by an upsurge in Bitcoin’s leverage ratio over subsequent days. This data is in sync with recent insights from Coinalyze, revealing key market shifts.
Bitcoin’s price narrative from AMBCrypto emphasized the significance of the $27k mark and hinted at the influence September’s CPI data could wield. The crypto community watched as this support level was breached in the last 24 hours. Yet, solely leveraged traders might not possess the strength to pull Bitcoin from this bearish abyss. Observations from the daily chart underscored Bitcoin’s bullish stature, especially with its recent bottom at $25,990. A decisive drop below this would alter the bullish narrative. However, indicators like the bullish order block and range low hint at Bitcoin’s potential for a rebound.
Short-Term Bearish Indications Dominate
Current market analysis at the time of writing portrays a dimming outlook. The surge of bearish vigor is evident across shorter timeframes. The one-day chart’s Relative Strength Index (RSI) nosedived below the neutral 50, implying a pivotal shift. The Chaikin Money Flow (CMF) indicated substantial capital flight from the market, positioned below -0.05. Although the On-Balance Volume (OBV) exhibited a resurgence in September, its trajectory sagged in the following week. Such dynamics suggest that the $24.8k-$25.8k zone might be the next optimal buying zone with a close invalidation point near $24.6k.
Accumulation Phase Evident from On-Chain Metrics
In stark contrast to the short-term bearish sentiment, on-chain indicators have illuminated a distinct accumulation pattern since late July. This is manifested by the BTC Mean Coin Age’s robust uptrend and the consistent reduction of Bitcoin supply on exchanges. Further, the Market Value to Realized Value (MVRV) ratio hints at Bitcoin being somewhat undervalued. However, short-term market sentiments paint a different picture. The Open Interest (OI) marked an uptick in short-sellers on 11 October, and the spot Cumulative Volume Delta (CVD) dominated the selling volume over the recent week. If this trajectory endures, Bitcoin’s recovery might be postponed, presenting trading opportunities for the vigilant.
