Bitcoin falls to a new 15-week low! The crisis in the American banking sector reignites panic sentiment, with short-term holders buying the dip of 110,000 BTC in three days.

Affected by the market panic triggered by the big dump of U.S. regional bank stocks, the price of Bitcoin fell below $105,000 on Friday, marking the lowest point in 15 weeks, with the latest trading price around $105,500. This big dump is viewed by traders as a retracement of the daily chart shadow caused by concerns over the China-U.S. trade war last week, with the key support level of $100,000 facing severe testing. However, on-chain data shows that short-term holders (STH) are actively buying the dip, accumulating approximately 110,000 Bitcoins within three days, signaling a potential rebound.

Safe-haven Asset Divergence: Bitcoin Sold Off While Gold Hits New Highs

Stocks of regional banks in the United States have begun to decline in a manner similar to the crisis in March 2023, reigniting market concerns about the financial system and putting pressure on Bitcoin prices.

· Price reaches 200-day moving average for the first time in 6 months: Bitcoin price falls below 106,000 USD, losing the previous support level of 108,000 USD, indicating technical weakness.

· Downside risk alert: Crypto investors like Ted Pillows and other experts believe that after losing the $108,000 level, the next support zone is between $101,000 and $102,000. If the price cannot reclaim $110,000, it may face more pain, potentially falling directly to $98,000.

· The Victory of Gold: While Bitcoin is falling, gold has reached a new historical high, highlighting the performance differences between the two assets in the current crisis. Notable Bitcoin skeptic Peter Schiff even predicts that gold will reach $1 million per ounce before Bitcoin does, and believes that Bitcoin “has failed the test as a viable alternative to the dollar or digital gold.”

On-chain signals: Large-scale buying the dip by short-term holders

Despite the macro and technical signals trending bearish, on-chain data shows that short-term holders (STH, or recently bought investors) are absorbing the selling pressure at an astonishing rate, and this accumulation could signal a potential turnaround.

· Unrealized P&L falls to a new low in April: The Net Unrealized Profit/Loss (NUPL) indicator for short-term holders has dropped to -0.04, marking the lowest level since April 20. A negative value typically indicates that most short-term holders are in a loss position, which is historically often seen as a signal of market bottom or early recovery.

· Historical Rebound Reference: Previously, when NUPL was close to a low point, Bitcoin experienced rapid rebounds in a short period, such as the two rebounds on September 25 and October 11, with an increase of about 4% to 5%.

· Increased holdings of 110,000 BTC in three days: According to Glassnode data, the total supply of Bitcoin held by short-term holders surged from 2.54 million BTC to 2.65 million BTC in just three days from October 13 to October 16, a growth of 4.3%. This means they acquired approximately 110,000 Bitcoins, worth nearly 1.2 billion USD, highlighting the recent strong conviction.

Technical Validation: Key Levels of Bullish Divergence and Breakthrough

(Source: TradingView)

The price trend of Bitcoin is forming a bullish technical pattern, but the rebound still requires confirmation of key price levels.

· Bullish divergence appears: On the 4-hour chart, the price of Bitcoin is forming a “descending wedge” pattern, which usually indicates a bullish breakout. At the same time, the price made lower lows after October 11, while the Relative Strength Index (RSI) made higher lows, forming a “bullish divergence,” which is a signal that momentum may be turning.

· Confirming the breakout point of the Rebound: To confirm the rebound, the Bitcoin price must rise by about 7.4%, breaking through $115900 to escape the descending wedge. Before this, $112100 and $113500 are key short-term resistance areas.

· Support line: If the support level of 107200 dollars is lost, Bitcoin may re-test the cycle bottom near 102000 dollars.

Conclusion

The decline in Bitcoin prices is a direct reflection of macro risk-averse sentiment, with the U.S. banking crisis and the divergence between Bitcoin and gold bringing significant uncertainty to the market. However, the active buying the dip by short-term holders and the bottom signs indicated by on-chain metrics provide structural support for Bitcoin. The fate of Bitcoin will depend on whether it can hold the support level at $107,000 and decisively break through the key resistance at $115,900. Whether this $12 billion buying wave can successfully translate into a stronger Rebound remains to be further validated by the market.

Disclaimer: This article is for informational purposes only and does not constitute any investment advice. The cryptocurrency market is highly volatile, and investors should make decisions with caution.