Bitcoin (BTC) dropped briefly below $62,000 after reaching an Oct. 7 high of $64,448. Although the weekly open had restorted traders’ hopes for a bullish October, today’s pullback to $62,000 signals that bulls are not in control just yet.
Bitcoin 1-hour chart. Source: Trading View
Bitcoin Coinbase Premium maintains ‘negative momentum’
Data from CryptoQuant highlights that the Coinbase premium has remained largely negative since the beginning of October, illustrating a lack of demand from Coinbase traders.
Bitcoin Coinbase Premium Index. Source: CryptoQuant
The Coinbase premium is an indicator of demand from US retail investors. A rising value indicates more buying pressure, and a negative value hints at selling pressure.
Previously, Cointelegraph reported a positive value for the Coinbase premium on Sept. 27, which coincided with Bitcoin reaching a new local high of $66,450.
At the moment, selling pressure from Coinbase is evident, and prices are reverting strongly in the chart. In fact, Dom, an independent trader, mentions that the recent correction from $64,400 took place after there was significant spot selling on Coinbase and Bybit.
CB selling the move again pic.twitter.com/BSTa11A2I0
— Dom (@traderview2) October 8, 2024
Meanwhile, XBTManager, an on-chain analyst, believes that a ‘negative momentum’ indicates that there is persistent selling pressure from Coinbase retail, which is currently contributing to the short-term bearish outlook. In an X post, the analyst mentions,
During the recent drop, Coinbase seems to have disrupted its buying activity and initiated some selling. If this continues, it could have a significant impact on the market.
Additionally, the analyst highlighted that traders on Bitfinex and Deribit have maintained their selling pressure, whereas BitMEX and Huobi remain stable with buying interest.
Bitcoin cumulative volume delta (CVD) on exchanges. Source: X.com
Meanwhile, Bitcoin ETF inflows witnessed a strong inflow of $235.2 million on Oct. 7, which is its largest positive netflow since Sept. 27, when BTC reached its recent high.
Therefore, while there is noticeable buying interest from the likes of Blackrock ($97.9M inflows) and Fidelity ($103.7M inflows), retail traders on certain exchanges are not buying into Bitcoin’s bullish recovery.
Can Bitcoin maintain a position above its key moving averages?
After a strong bullish reaction on Oct. 6, Bitcoin has faced downside pressure after testing the supply zone between $63,300 and $64,200. Since its 3% decline, BTC has failed to close above $63,000 in the past 24 hours, and it is currently facing pressure to maintain its position above its 50-day and 100-day EMA levels.
Bitcoin 4-hour chart. Source: Trading View
At the moment, Bitcoin remains above the 200-day EMA level, but a close below $61,700 would lead to another short-term bearish trend shift. A position below the 200-day EMA would open the possibility for another sweep around the equal lows of around $60,000 established early in the month, as depicted in the chart.
Meanwhile, Theo Trader, a crypto trader, believes that the current price action is giving ‘mixed signals,’ opening a possibility of an ‘accumulation phase around $60K.’
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.