According to the analysis of Jins, the in-house, leading crypto analyst at CoinNess.com, the reason behind the Bitcoin's (BTC) decline can be put down to the increasing pressure brought by investors' chasing for a higher price, which has changed the longs' bullish view on the king coin. As a result, the retracement happens to BTC. Judging from the key point of retracement, the bottom may dip to as low as $8,000.
With respect to the short-term trading volume and price, the longs began to cover short positions when BTC plummeted. Although the trading volume increased at the low prices, the short-term bargain hunting may not alter the retracement. That is to say, in the atmosphere of panic bargain-hunting, investors in ultra-short-term trading will not easily change the price trend. The space for the oversold bounce may be suppressed.
In regard to the Bitcoin active addresses, the number of active addresses in this round of bull market is more than 1.03 million, which is not that high compared with the maximum of 1.26 million in 2017. As for the newly-created addresses, the maximum number of new addresses is 520,000, which has made a very large gap compared with 680,000 in 2017. Even so, the trading volume in the market is eye-popping high. This reminds people that perhaps a small number of investors have created a lot of trading volume, which has enabled BTC to reach a record high of around $14,000 with a historical high trading volume.
In the phase of BTC's recovery, the rising in June was seen as a result of retail investors' buying in when the price was high, and the trading volume during the period was staggering. Therefore, investors who hold the cryptocurrency at this stage are also more prone to lighten up.
After all, the BTC price has fallen below the 60-day moving average, and the average cost of investors within two months might have been broken. Hence, the likelihood that BTC falls to $8,000 is thick. Meanwhile, the current BTC short-term rebound is the normal reaction in the downward trend.