Stagnant Bitcoin Price: Insight from a Crucial Financial Indicator

Key Points

• Bitcoin’s volatility has doubled, causing a significant price drop and maintaining a distribution phase.
• Large entities are depositing more into exchanges than withdrawing, indicating an intention to sell.

Bitcoin’s [BTC] price has seen a significant drop of 8.57% within the last 24 hours.
This is a result of Bitcoin’s increased volatility.

Bitcoin’s Distribution Phase

Bitcoin’s accumulation score, according to Glassnode, has remained below 0.5 for the past 58 days.
This suggests that the cryptocurrency is still within a distribution phase.

The average duration for distribution over a year is approaching, which aligns with previous cycles.
In the past year, the distribution phase averaged 65 days while accumulation cycles lasted 57 days.

Whale Activity and Market Impact

The activity of large entities, or ‘whales’, further validates the ongoing distribution phase.
These whales are depositing more into exchanges than they are withdrawing, indicating a possible intention to sell.

This selling activity has strongly impacted Bitcoin’s price.
As a result, the crypto’s price has dropped to $83,908.

Unless the market transitions to accumulation, Bitcoin’s price will continue to drop.
However, there is currently no signal of this transition occurring.

If investors continue to lack motivation to accumulate while holders continue to sell, Bitcoin’s price could drop to $82,500.
Once the macroeconomic uncertainties affecting the market cool down, organic demand could return to the market.
This could potentially lead to Bitcoin reclaiming higher price levels.