Bitcoin price has been steadily declining since the end of February and has not exceeded $85,000.
In recent price movements, Bitcoin has been maintaining stability below this important level. Major investors remain unshaken. Many continue to HODL, indicating long-term confidence.
Bitcoin Investors, Optimistic
Bitcoin's velocity, an indicator measuring cryptocurrency circulation, recorded its lowest point in five months last week. This decrease in velocity suggests that Bitcoin holders are becoming more cautious. Fewer coins are being traded. When circulation decreases, price increases are often suppressed, and BTC has recently experienced this trend.
The decline in velocity reflects a change in investor sentiment, with a general hesitation among market participants. As a result, Bitcoin price recovery is slow, and this cautious approach is reflected in current market behavior.
In contrast to the cautious short-term sentiment, medium-term holders (3-6 month holders) have seen wealth increase during this period. They are transitioning to long-term holders (LTH), showing a change in investor confidence. Many of these coins were acquired near Bitcoin's all-time high, and their continued holding indicates strong conviction.
Spending by this group has reached its lowest level since mid-2021. This suggests that long-term holders are unlikely to sell even during periods of market uncertainty. This reduction in selling pressure is a positive signal, indicating that major investors are maintaining their positions and not succumbing to market declines.
Will BTC Price Recover Recent Losses?
At the time of writing, Bitcoin price is at $83,403, just below the critical $85,000 resistance level. Bitcoin surged to $88,500 earlier this week but declined after Trump's tariff announcement. This caused a temporary dip in market sentiment, but the price stabilized above $80,000.
Bitcoin can recover if long-term holder support continues. However, this requires $85,000 to first be reclaimed as a support level. A confirmed recovery would be indicated by Bitcoin breaking through $89,800, suggesting a potential path to higher levels.
If breaking $85,000 fails and circulation remains low, Bitcoin price could fall back to the next major support level at $80,301. Such a decline could invalidate the upward outlook and lead to additional correction or downward trend in the short term.
