Over the past three months, BTC has traded in the wide range between $32K and $45K, which resulted in mass accumulation of the digital asset by investors. At some point, the coin managed to break through the $45K barrier and left the range. It turned out to be a false breakout, and bitcoin went down again to trade in the range.
The accumulation process is mainly associated with an increase in profit taking and a decrease in the income of miners who sold BTC to offset losses. A false breakout at $45K occurred mainly due to the high percentage of short-term investors. They were mostly retail investors who bought the asset at a favorable price in March. Eventually, about 18% of them started to hold BTC. Such a high percentage of retail investors holding the asset triggers market jitters due to impulsive decisions and rash behavior.
The slugging activity within the BTC network over the past month and a half is the result of the redistribution of capital. According to Glassnode, most of the coins purchased at the price of over $40K were acquired by long-term holders. Those mainly taking profits were investors who bought the asset when it traded in the $32k-$35k range. Over the past month and a half, they got rid of 60,000 BTC coins. A number of investors incurred losses after acquiring the coin at an all-time high.
In April, major and long-term investors managed to activate one of the largest accumulation stages in terms of volume. Meanwhile, demand for BTC among retail traders and speculators dropped sharply. They were players who actively bought the asset in the first weeks of the Ukrainian conflict. Their activity decreased even more after hawkish statements by the Fed and the formation of a corridor in the range of $45K-$48K. The situation is finally stabilizing and the accumulation stage is coming to an end.
BTC has become less exposed to price swings, which allowed long-term investors to build a more balanced and safe upside structure. With this in mind, we may expect volatility to decrease and the price to start rising smoothly.
In the daily time frame, BTC/USD surged to resistance and then pulled back to key support. Taking into account the fact that this happened in the wide ascending channel, we may assume that the next upside move will take place around $50K. At the same time, should the quote break through the $39 barrier, it will no longer be the case.
Technical indicators signal that the current buying activity is not enough to extend the bullish impulse. The MACD is moving down below zero. The Stochastic and the RSI are flat. Therefore, we may expect an accumulation stage to begin any time soon and the price to attempt to touch the $50K mark.
