Bitcoin Exchange Transactions Hit Record Lows—What This Means For BTC’s Price
Bitcoin’s price has seen significant fluctuations over the past few days, largely influenced by macroeconomic developments and market fundamentals.
Bitcoin price following Federal Open Market Committee (FOMC) meeting and speech by Fed Chairman Jerome Powell Sharp fall below $99,000.
However, the leading cryptocurrency quickly rebounded, Back to $104,000 Earlier today, it closed at $100,573 at the time of writing. This represents a 3.4% decline over the past day and a decrease of approximately $67 billion in market capitalization valuation.
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Exchange trading volumes hit record lows
Amid this price performance, CryptoQuant analyst Woominkyu provided opinion Market activity in Bitcoin highlights the decline in exchange trading volumes.
Woominkyu said historical data shows a correlation between surges in trading volume and large price swings. For example, in 2017 and 2021, spikes in exchange trading coincided with significant increases in Bitcoin prices.
However, recent data shows a significant decline in transaction volumes in both places. Spot and derivatives exchangesreflecting reduced transaction activity compared to previous years.
Analysts at CryptoQuant said the drop could indicate “reduced market participation,” suggesting a “consolidation period or lower volatility” in the near future.
Bitcoin key support levels and technical insights
Owned by market intelligence platform IntoTheBlock illuminate An important support area has formed below the $100,000 mark. Data shared by the platform shows that the average price is $97,500 and more than 1.45 million BTC have been accumulated.
This accumulation establishes an important zone of demand that has the potential to act as a “buffer” against further price declines. The importance of this level lies in its ability to price stabilityEspecially with Bitcoin in its current market correction phase.
Some believe that a breakout of this area could trigger further downward pressure, while a stay above this area could catalyze a recovery.
Meanwhile, from a technical perspective, insights shared by market analyst Satoshi Wolf highlight the critical nature of Bitcoin’s current price levels. The cryptocurrency recently tested support at $100,000, in line with the 100-day exponential moving average (EMA).
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This level is crucial because it combines technical indicators with psychological meaning. Moving Average Convergence Divergence (MACD) indicator display Bearish momentumwhile the Relative Strength Index (RSI) is approaching oversold territory, indicating a possible price reversal.
Wolf advises traders to watch for confirmation of a break above $104,000 or a break below $100,000, with volume confirmation being key to verifying both.
📊 Bitcoin USD Analysis: The chart shows a recent pullback after a strong uptrend, hinting at potential profit-taking. Price is testing the 100,000 support level in line with the 100 EMA, which is a key level to watch.
If it holds, a rebound to the 104,000 resistance level is possible. Smoothed Moving Average Convergence and Divergence… pic.twitter.com/smLaqsr2Tz
— Satoshi Wolf (@SatoshiWolf) December 18, 2024
Featured image created using DALL-E, chart from TradingView
