According to Michal van de Poppe, encouraging indicators are developing throughout cryptocurrency charts, but Bitcoin’s comedown from 10-day highs offers no surprises.
On December 23, Bitcoin (BTC) remained steadfastly inside its narrow range, as price behaviour continued to defy heavy buying activity.
Hodlers busy accumulating
BTC/USD failed to sustain $49,000 after achieving 10-day highs, according to data Trading View. The pair remained trapped in a trading range of only around $4,000, fuelling expectations that a “short squeeze” would occur over the holidays. In the face of reducing volatility, data showed that investors were more confident than ever, with supplies being purchased at almost three times the rate of new BTC being created.
In the latest edition of its weekly newsletter, “The Week On-Chain,” on-chain analytics firm Glassnode detailed how “strong handed HODLers are absorbing supply at more than quadruple the rate of new coins being generated each day.”
Furthermore, at a spot price of $47,000, over a fifth of the BTC supply was underwater compared to when it last moved, according to Glassnode. The possibility of a BTC/USD squeeze up or down will likely grow in the new year as lower activity thins out liquidity and allows for greater volatility to enter.
“Santa rally” comes to XRP as altcoins simmer
Only two of the top ten cryptocurrencies by market capitalization were still in the green on daily timescales at the time of writing, indicating that Wednesday’s euphoria was dissipating.
However, according to Michaal van de Poppe, indicators of a new year’s resurgence made buying this week a sound idea.
“More and more weekly charts are shaping up beautifully on the altcoins,” he told Twitter followers.
“2022 will be massive.”
