Bitcoin rally stalls at $39.2K but BTC price metric suggests local bottom could be here

Bitcoin (BTC), which was advancing on February 23rd at Wall Street opened, as Russia’s repercussions continued.

BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView

Stocks suffer from crypto recovery

Cointelegraph Markets Pro and TradingView data showed that BTC/USD fell to $38,000 in February 23, after having previously reached $39,200 highs.

The Russia-Ukraine conflict pressure remained a threat to equity markets, with which Bitcoin and altcoins are closely linked.

S&P 500 fell 0.25% within its first hour. Russia’s MOEX index suffered further losses starting February 23, and was down 7.3% as of the time this article was written.

On news that Russia would not allow Russian businesses to clear in dollars or sterling, the Russian ruble fell in step. It accelerated past 80 to the US dollar.

Market participants searching for low-timeframe shots had to constantly reevaluate their approach because of the uncertainty.

Bitcoin Bullish Inverse Head and shoulders bottom forming good risk reward entry here with stop at $34K pic.twitter.com/fk8N6fAwQo
— Will Meade (@realwillmeade), February 23, 2022

William Clemente, Blockware’s lead insights analyst, tweeted that he was bullish on Bitcoin over the next few months. He also spoke about the macro outlook for the long-term.

“Strong holding behavior on the chain paired with a lot relative dry powder sitting in exchanges, stacked bidside order books & prolonged regime spot premium over perps. Next week will bring March, and max hawkishness is likely priced in.

As Bitcoin continues to follow global equities in the meantime, Ki Young Ju (CEO of CryptoQuant), argued that this was not all bad news to those who hoped that Bitcoin would decouple and become an asymmetric hedge to global uncertainty.

“Good News: BTC has been adopted by traditional institutions. New players trading stocks are changing its ownership. Bad news: BTC isn’t a safe-haven investment. He summarized the following:

Supply Delta suggests a possible price U-turn

However, Bitcoin looks a lot more promising than Clemente suggested if you turn to on-chain metrics.

Related: “You’d best buy some Bitcoin” — BTC numbers defy Canada’s gov’t, as ETF assets set records

The Supply Delta metric was in focus on February 23rd. It measures the percentage of BTC supply that is held by both short-term and longer-term holders.

Charles Edwards, founder of Capriole, noted that Supply Delta was able to call local price tops. It was currently printing a bottom to long-term holders share as of this week. This is a traditional price bottom.

The wallets of long-term holders have not sold in the last 155 days. Short-term holders, on the other hand, sell within that time period.

Short-term supply peak peaks seem to be immediately followed by price tops.

Edwards stated, “From a supply perspective, Bitcoin is in an important accumulation zone.”

Annotated chart of the Bitcoin supply delta. Source: Charles Edwards/Twitter

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