Bitcoin (BTC) is starting to move into an increasingly tight range again. The price has now established a series of higher lowsbut also lower highs and is currently consolidating just below $30,000.

After such a pattern, which is also called a symmetrical triangle or wedge pattern is usually called an outbreak. However, as fears are still very high in the cryptocurrency market, as well as in more traditional markets, there is a chance that we will see a breakout down first.

Bitcoin price drops by 3%

Bitcoin price dipped to $29,300 Monday night, but then started to recover, reaching above $30,500 by yesterday morning. Bitcoin initially held its ground, but when the price touched $30,750 yesterday afternoon, it was rejected.

Bitcoin plunged for a while and touched a low of $29,500 last night, another higher low. Bitcoin immediately made a significant bounce and immediately recovered, but only got below $30,650 and started falling again.

Bitcoin found support around USD 29,850 this morning. The price briefly peaked above $30,000, but at the time of writing, the price is back at $29,800 on KuCoin and $28,300 on Bitvavo. Bitcoin is currently 3% in the min.

Panic and conviction in bitcoin

The recent fall in price resulted in a well-known trend. Out on chain Data shows that especially newer investors, or short-term holders, sold the dip out of panic.

In the meantime, long-term holders are still holding their BTC firmly, so that the price has not plunged deeper for the time being. This can be seen in the ever-increasing share of the BTC supply that has not moved for at least a year.

The Negative Correlation Between BTC & DXY

In addition, the US dollar index (DXY) rate has been rising again in recent hours. DXY slid below the line that it resisted earlier this month before breaking through yesterday.

Despite this, DXY found support shortly afterwards. Now the DXY is again approaching the same limit, but it may have turned back from support to resistance. If DXY breaks through this, that could be bad news for bitcoin, but also vice versa.

Investors buy dip, but whales plunge?

Still, there are signs that some investors are already buying the dip. Analyst Philip Swift reports that the number of addresses increased by at least 1 BTC last month.

The Dutch CryptoQuant analyst Maartunn reports that the bitcoin supply on cryptocurrency exchanges has even reached a new low:

However, the analyst reported a few hours later that some whales are still depositing their BTC on exchanges. This could potentially increase sales pressure.

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