Bitcoin [BTC] traders must sit tight without expecting short-term gains because…
The price movement of Bitcoin [BTC] it hasn’t been to the delight of its investors lately. Since it struck $ 25,000 on August 15th that sent investors in jubilation, BTC has now succumbed only to the reds.
Although it consolidated at around $ 24,000 as of August 17th, the past two days have been worse as the price of BTC remained at $ 21,290 at press time. For CoinMarketCap, BTC had lost more than 13% of its value in the past seven days. However, logs showed that over 60% of this loss occurred between August 18 and the time of writing.
Prepare for distress
While investors may be hoping that the bottom is nearing the bottom, BTC’s current momentum may think otherwise. This assessment is according to Ghoddusifar, a CryptoQuant analyst. According to the analysis, there is a possibility that BTC could drop an additional 30% from its current state.
Why did it happen? Ghoddusifar said the BTC Relative Strength Index (RSI) was already broken. He added that there had been four bearish flag patterns since the start of the recession and if another emerges, it could lead to another 30% price drop.
A look at the four-hour chart may have confirmed that the analyst’s projections may hold true. The latest momentum indicated that BTC was facing extremely high volatility as the Bollinger (BB) bands expanded further as the price continued to fall. Furthermore, the RSI was at an incredibly oversold level with its value of 25.62 at press time. Despite the decline, the RSI showed no signs of recovery to welcome buyers.
The Directional Movement Index (DMI) also shared the same sentiment. The BTC / USDT chart revealed that the DMI favored sellers as the -DMI (red) at 33.83 was well above the + DMI (green) at 9.19. BTC investors may have wished the direction was weak, however the average directional index (ADX) showed a strong move in favor of the reds.
Metrics on the chain
Santiment on-chain data platform shown that the ratio of market value to realized value (MVRV) was not in a good position to allow investors to make profits. With the thirty-day MVRV at -7.1%, most BTC investors who sell at the current price could risk selling at a massive loss.
Despite clear bearish signals, BTC’s volume has increased. In the past 24 hours, there was a 14.27% increase to $ 38.37 billion.
Comparing the status of on-chain metrics and Ghodduisfar’s forecast, it may be a wise decision for BTC investors to take a break on short-term profit expectations as a 30% drop may not seem impossible.