Bitcoin is selling off at writing and approaching psychological support at $60,000. From what’s clear on the daily chart, it represents a weak start to Q4 2024 – a historically bullish quarter.
Bitcoin miners reduce their dumping
While Bitcoin is under pressure, down nearly 10% from its September highs, it is clear that Bitcoin miners have been slowing down their liquidation activities. In a post on X, one analyst He notices Over the past few weeks, major Bitcoin miners have gradually reduced currency transfers to major centralized exchanges such as Binance and Coinbase.
This development represents a massive price increase after the halving event on April 20. Typically, given previous trends, before and after the halving, miners tend to move their reserves to exchanges, and sell them as they adapt to the new inflation regime.
After the halving, the protocol automatically reduces block rewards by 50%. The 50% drop also means that miners have to adjust to an equal drop in revenue, especially if the transaction fees associated with each block do not change significantly.
After prices rose to nearly $74,000 in March, market traders expected Bitcoin to resume the uptrend immediately after the halving. However, due to thousands of bitcoins sold by “vulnerable” miners after the halving, prices fell even with net inflows in some cases from US Bitcoin ETF issuers.
Will BTC bounce back in Q4 2024?
Therefore, reducing selling pressure from miners would likely support prices. Their decision to slow down BTC liquidation indicates that they expect prices to recover in the coming months. For an uptrend to continue, traders track fundamental factors.
A historically bullish Q4 2024, especially in October and November, could support optimistic bulls. The problem now is that the losses of the past three days mean that this is the worst start to October for Bitcoin in at least a decade.
Short-term sell-off, analyst He sayscould be contained if short-term holders (STHs) reduce their supply by 80,000 BTC. STHs are entities that have purchased the coin within the last 155 days.
They are often considered speculative and pose a risk to BTC’s upside since they tend to sell off and cannot withstand sharp price fluctuations. If they reduce the supply, BTC may find support at $60,000. Otherwise, if the bears continue, the coin could fall below $57,000 – a support line forming on the daily chart.
Featured image from Canva, chart from TradingView