Bitcoin price fell as low as $66,865 on Wednesday, June 13, as the US Federal Reserve dashed investors’ hopes of an H1 2024 rate cut; on-chain data trends explain how BTC managed to stay above the critical $65,000 support level.
Bitcoin Price Tumbled 7% After US Fed Rate Pause Decision
The crypto market slipped further into its ongoing consolidation phase, as bulls failed to build on the positive start to June 2024, amid hawkish shifts in US macroeconomic indices.
Despite the slowing CPI inflation signalling an imminent economic soft-landing, the US Federal Reserve has opted to keep interest rates at elevated levels after the latest FOMC meeting on June 12.
As expected, risk assets markets including the cryptocurrency sector reacted negatively to the Fed rate pause decision.
As seen above, Bitcoin price rapidly fell as to a daily timeframe bottom of $66,896 after the US Fed rate decision hit the news reels on Wednesday, June 12. This marks 7.22% decline in BTC prices within the 7-day timeframe.
But interestingly, despite the negative short-term market sentiment, Bitcoin bulls managed to avert a reversal below the critical $65,000 psychological resistance.
Long-term Investors Unwilling to Sell Bitcoin
After nearly a week of rising market volatility, Bitcoin sellers are now showing early signals of fatigue. If it persists, this move could spark a mild BTC price rebound phase in the coming weeks.
Santiment’s Age Consumed chart below monitors the level of selling pressure among long-term investors. Essentially, it is derived by multiplying the number of BTC coins traded on a given day by the number of days since they had stayed unmoved.
Whenever a number of long-term BTC investors are in sell-off mode, a significant spike shows up on the Age Consumed chart, and vice versa.
Bitcoin Age Consumed only a monthly time-frame peak of 45.35 million on June 11, as traders entered a rapid selling frenzy in the aftermath of the latest US Federal Reserve’s rate pause decision.
However, looking closely at the snapshot above, the latest BTC Age Consumed spike is 91% lower than last month’s peak observed on May 28. This indicates that the majority of long-term investors in Bitcoin are unwilling to carry out another large-scale sell-off within the current market dynamics.
In combination with rising inflows from Bitcoin ETFs, this decline in selling tendencies among long-term holders largely explains why BTC price avoided a reversal below $65,000, instead consolidating above the $68,000 territory on Thursday, June 13.
Bitcoin Price Forecast: $65,600 Support to the Rescue
Drawing inferences from the on-chain data analysis above, Bitcoin price looks set to consolidate above the $65,000 level despite the current negative market sentiment. IntoTheBlock’s IOMAP data further affirms of this optimistic Bitcoin price forecast.
As seen below, there’s large cluster of 1 million addresses, that acquired 573,740 BTC at the average price of $65,591.
To avoid slipping to a net-loss position, majority of those holders could opt to make covering purchases if BTC price tumbles close to the $65,600 in the near-term, there by triggering a rebound.
Likewise, in the event of another upward price breakout, Bitcoin bull will face daunting resistance at the $69,000 territory.
In effect, without any outlier catalyst, BTC price now looks likely to consolidate within the $66,000 to $70,000 channel as the week draws to a close.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
