Bitcoin (BTC) underwent a slight correction on the day the global stock market crashed.
The largest cryptocurrency has plunged nearly 8% in the last 24 hours and gained most of the profits recorded during yesterday’s March 3 rally.
Bitcoin’s bullish trend is still in its early to mid-stage
According to William Clemente, cryptocurrency analyst, the Glassnodes Reserve Risk Index shows that Bitcoin’s growth is still in its infancy.
As Clemente explains, the reserve risk is defined as the HODL / bank interest rate. The indicator is used to “assess the long-term confidence of currency holders about the price of the underlying currency at the moment”.
Bitcoin reserves risk. Source: Glassnode
Hence, if the risks of reserves are still relatively low compared to previous peaks, this indicates that Bitcoin is not in danger of approaching the overall peak.
Bitcoin’s risk reserves are currently half the level seen in 2013, 2014 and 2017, when the price of Bitcoin fell more than 50% and entered a bear market.
Moreover, while Bitcoin has weakened over the past 20 hours, it is doing well given that the global stock market has seen a significant decline.
Kyle Davis, co-founder of Three Arrows Capital, indicated that the global macro was sold, but Bitcoin did not see a major correction as a result. He said:
“You should look for relative strength when others are weak. The global macro was sold out yesterday and BTC gave nothing. ”
For example, large tech stocks and retail-focused stocks like Tesla fell sharply on March 3. As a result, most of the risk-weighted assets collapsed, indicating an overall weakness in the global market as a whole.
The decline coincided with an increase in swap deposits
Meanwhile, CryptoQuant CEO Ki Yong Joo warned of an increase in swap deposits as the bitcoin price fell below $ 50,000.
When whales deposit bitcoins on exchanges, it usually indicates an intent to sell. Large investors often hold their cryptocurrency assets outside of exchanges.
“Update: a slight increase in the flow of all exchanges means 52,000 kroons. This can lead to a slight decrease. I’m not sure how much he can fall at the moment. ”
The combination of whales that can sell bitcoins on exchanges and the gloomy landscape in general may have contributed to the drop in bitcoin’s price.
In the long term, however, the outlook remains optimistic as the supply of illiquid bitcoin continues to grow.
Lex Moskovski, CEO of Moskovski Capital, also indicated that powerful shareholders are increasing their positions in bitcoin.
As long as strong hands and wealthy investors continue to accumulate bitcoin, the upward development is likely to remain the same.
In addition, the high time frame Bitcoin market structure remains compelling, breaking the $ 46,000 level, making it new tech support.