The Bitcoin price has experienced a notable shift as selling pressure mounts, with BTC bears gaining the upper hand. Asset manager Grayscale, the owner and manager of the Grayscale Bitcoin Trust (GBTC), is a significant contributor to this trend. 

Since the trading of spot Bitcoin exchange-traded funds (ETFs) began on January 12, Grayscale has been on a selling spree, as evidenced by substantial transfers of BTC to the United States-based crypto exchange Coinbase.

Bitcoin Price Under Pressure As Grayscale Selling Spree Continues

According to Akrham Intelligence data, in addition to the previously reported 69,994 BTC ($2.9 billion) transfers, Grayscale sent an additional 8,593,075 BTC (approximately $335.19 million) to the exchange on Tuesday, suggesting the possibility of further selling activities.

These developments have affected the Bitcoin price, which has experienced a significant downtrend, declining by 20% over the past week and a half. 

On Tuesday, the largest cryptocurrency dropped as low as $38,500, placing considerable pressure on a crucial support level. Despite the bearish pressure, the $38,500 support level has demonstrated resilience so far, with the cryptocurrency rebounding to $39,300 at the time of writing. 

Nevertheless, the duration of Grayscale’s selling spree remains uncertain, and if market sentiment continues to turn negative, Bitcoin could potentially revisit the $30,000 mark. This figure is just above the key $29,000 level that marked the beginning of the bull run that took Bitcoin to its 22-month high of $49,000 on January 11th.

Bears On The Rise

If the $38,500 threshold succumbs to Grayscale’s selling pressure and profit-taking, market observers should closely monitor the $37,750 level as the next resistance. 

Failure to hold above this level would open the door to a potential decline toward the major resistance at $35,600, which could further prevent a dip to the next support level at $33,000.

However, if these support levels are breached and the Bitcoin price continues its downtrend, the next significant key levels to watch for bullish momentum would be $29,000 to $30,000. A breakdown below these levels could signal an end to the current bull market structure and grant the bears the upper hand in the mid-term, at least until the anticipated halving event in April. 

Historically, halving events have acted as major catalysts for the Bitcoin price, and their influence has been demonstrated.

As the Bitcoin market faces intensified selling pressure and Grayscale’s ongoing selling spree, market participants remain cautious about the potential for a significant price plunge. The coming days and weeks will be critical in determining whether Bitcoin can regain its bullish momentum or if it will succumb to further downward pressure.

Featured image from Shutterstock, chart from TradingView.com

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Filed under: Bitcoin - @ January 24, 2024 3:30 am