Considering the way the market has been moving over the past few weeks, a pullback was imminent. Bitcoin [BTC] witnessed a second correction on June 4, pushing down the price of the king coin below $8,000 for the first time in a week, with the elusive $9,000 break-out failing to manifest.
As the attention was firmly affixed on the price chart, several pertinent indicators showed divergent movements. Trading volume particularly deviated from the norms, as the price dropped by over 6 percent in under four hours and the “real trading volume” moved up. The same was confirmed by Senior Market Analyst at eToro, Mati Greenspan, who highlighted that Messari Crypto’s real 10 pushed up by $1.5 million. The analyst also noted that this was “higher than it’s been in about two weeks”.
Messari Crypto’s “Real 10” volume represents trading volume from the ten exchange that quote “real volume”, according to the Bitwise Asset Management report published specifically for the US Securities and Exchange Commission [SEC] in March 2019. The ten exchanges in the list were Binance, Bitfinex, Kraken, Bitstamp, Coinbase, bitFlyer, Gemini, itBit, Bittrex, and Poloniex.
Greenspan further noted that the drop in transactions of the king coin as the price moved downwards indicated that the real world use-case was dwindling. Since May 24, the transaction count topped at 452.46k, which soon dropped to 404.81k. The recent price fallout shot the transactions count below 300k and at press time, it stood at 293.89k.
The eToro analyst’s tweet, detailing both the transaction count and volume, read,
Also interesting to note that the move down happened with a divergence in volumes. @MessariCrypto real 10 is up at $1.5 billion, higher than it’s been in about two weeks, while on-chain BTC transactions have come off their highs. pic.twitter.com/ZWpQVwBeot
— Mati Greenspan (@MatiGreenspan) June 4, 2019
Further, according to models presented by Greenspan, the current pullback below $8,000 not only cut short the optimism in the collective market, but also broke an important 1-day trendline that has been tracking the price since mid-May. In a tweet prior to the one mentioned above, Greenspan who characterized the trendline as “aggressive”, affirmed that it had been broken by the pullback.
A second trendline, one more “conservative” than its predecessor which has been following the price prior to the April 2 daily gain of over 17 percent, is still holding strong but presents a pessimistic trend. However, the support that the line indicates is in the range of $6,400 – $7,100, well below the current price of the king coin. This line could well be ‘tested’ or the price could ‘consolidate’ at current levels.
Needless to say, with every Greenspan analysis, the same caveat applies,
“Past performance is not an indication of future results. This is not trading advice. Crypto is risky.”
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