Bitcoin surged above $50,000 for the first time since December 2021, which is more than two years ago. The crypto asset broke multiple resistance levels along the way.
However, sustaining this psychologically significant threshold proved challenging, as Bitcoin retraced to the $49,800 mark on Tuesday. There’s a crucial resistance level at play that could induce selling pressure in the Bitcoin market upon claim.
In fact, there are signs of increased profit-taking by investors following the latest leap.
Another Bitcoin Resistance At Play
Lookonchain, a prominent on-chain analytics platform, referenced data from ITB to reveal that around 375,000 addresses purchased approximately 119.48K Bitcoin, totaling $6 billion, at an average price of $50,227.81.
After a brief tryst in the profit zone, these addresses are back in the red, which could lead to selling pressure once they reach breakeven.
The price of $BTC just rose above $49.8K!
These addresses are currently at a loss and may generate selling pressure when their positions reach breakeven.… pic.twitter.com/c69xENYkMK
— Lookonchain (@lookonchain) February 12, 2024
Bitcoin had recently climbed above $48,491, where over 800,000 addresses having amassed approximately 270,000 BTC. This cohort of Bitcoin holders slid into green territory after almost two years.
The upward potential of Bitcoin appears to be in jeopardy as investors increasingly show interest in taking profits following the correction.
A similar view was shared by a CryptoQuant analyst, noting that currently, 97.3% of Unspent Transaction Outputs (UTXO) are in a profitable state. This suggests that selling pressure could transpire in the near future if Bitcoin investors opt to cash in on their profits.
Institutional Demand for Bitcoin Soars
The Coinbase Advanced exchange, which is mostly used by institutional investors, noted a huge outflow of Bitcoin.
This could demonstrate that while certain groups of Bitcoin investors have turned to offloading assets to capitalize on profits, institutional investors, on the other hand, are transferring their holdings away from the exchange and are in no mood to dump despite market recovery.
This trend essentially underscored the growing demand for Bitcoin among institutional investors, who previously experienced a decline in confidence.