Bitcoin’s ascent toward the $70,000 threshold has garnered significant attention from analysts who are closely monitoring a crucial supply zone within the cryptocurrency’s price range. This zone holds particular importance as it signifies a pivotal area where a substantial volume of Bitcoin was acquired.
According to crypto analyst Ali, the identified supply zone for Bitcoin spans between $70,180 and $70,600, with over 450,000 addresses collectively acquiring approximately 273,000 BTC.
Such supply zones are pivotal areas on the price chart, often acting as barriers to upward price movements. They represent regions where a significant amount of Bitcoin was previously bought, potentially prompting holders to break even or take profits, thus leading to heightened selling pressure.
Bitcoin’s recent price action has seen a steady recovery from its May 1 lows of $56,500, with the cryptocurrency surging to highs of $71,980 on May 21 before encountering resistance. As of the latest update, BTC was experiencing a 1.91% decline over the past 24 hours, trading at $69,998.
Potential scenarios for Bitcoin’s movement abound. A decisive breakthrough above the $70,600 level, accompanied by robust trading volume, could signal a continuation of the bullish trend. Such an occurrence would likely attract more buyers, propelling the price higher and potentially establishing a new support level.
Conversely, if Bitcoin encounters substantial selling pressure within this range, it could prompt a rejection of prices and subsequent pullback. This scenario would suggest that numerous holders are eager to realize profits, resulting in temporary resistance.
A third possibility is that Bitcoin consolidates below the supply zone, indicating a balance between buyers and sellers before a significant price movement ensues.
As Bitcoin deliberates its next trajectory, market observers are closely monitoring price behavior around the $70,000 mark, given the substantial volume of BTC accumulated in this area.
Drawing insights from the MVRV Pricing Bands, Ali suggests that if Bitcoin maintains its position above $65,125, the cryptocurrency could potentially reach a local peak before experiencing a temporary decline around the $77,593 mark.
