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Bitcoin Plunges Under $63,000, Here’s Where Next On-Chain Support Is

Bitcoin has deepened its decline in the past day with its price now slipping below $63,000. Here’s where the next potential support is, according to on-chain data.

Bitcoin Could Find Support At These Price Levels

In a new post on X, analyst Ali has discussed how the Bitcoin support and resistance levels are looking like right now based on on-chain data from Glassnode.

The indicator of relevance here is the “UTXO Realized Price Distribution” (URPD), which, in short, tells us about the amount of coins (or more precisely, UTXOs) that were last purchased at any given price level that the asset has visited in its history so far.

Below is the chart shared by the analyst that shows the data for this distribution for the price levels around the recent spot value of the cryptocurrency:

Bitcoin URPD

From the graph, it’s visible that there are a few price levels not far from the current one that particularly stands out in terms of the amount of buying that took place at them.

In on-chain analysis, the potential for any level to act as support or resistance is based on the total number of coins that have their cost basis at the level in question.

Levels thick with coins that are situated under the current price would be probable to act as points of support, while those above the spot value could prove to be resistance walls.

As is apparent from the graph, the $61,100, $56,685, and $51,530 levels are the ones below the current price that hold the cost basis of a notable amount of the supply right now. Naturally, this means that should the decline continue further, these would be the levels to watch for a possible rebound.

Two levels above, however, are even larger than all three of these support levels: the cost basis centers around $66,990 and $72,880. Interestingly, the latter of these is the single largest acquisition level out of all the price levels listed in the chart, implying that a large amount of FOMO buying has occurred at the asset’s all-time high levels.

In the scenario that Bitcoin regains its upward momentum, these levels of high cost basis population would be where the asset could be most probable to find some trouble.

Now, as for why acquisition centers are considered relevant for support and resistance in on-chain analysis is the fact that investors are likely to show some kind of reaction when a retest of their cost basis takes place.

When such a retest is from above, the holders may decide to accumulate more, believing that the price will go up again in the future. On the other hand, they may sell instead if the retest is from below, as they may think exiting at break-even is better than risking another drop.

A large number of coins having their cost basis at the same level means a potentially large degree of one of these reactions happening and, hence, a strong support or resistance effect on the price.

BTC Price

Bitcoin is inching closer to the first major on-chain support level as it has now dropped to $62,700.

Bitcoin Price Chart

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Bitcoin Safe From Drops Under $60,300? On-Chain Data Says So

On-chain data shows Bitcoin currently has a thick supply wall between the $60,300 and $62,155 levels that may prevent the asset from falling lower.

A Large Amount Of Bitcoin Was Bought Near Current Prices

As explained by analyst Ali in a new post on X, BTC has a major support wall just below it right now. In on-chain analysis, the strength of support and resistance levels is gauged through the amount of Bitcoin that the investors bought at them.

The chart below shows how the distribution of the investor cost basis has looked like for BTC across the price ranges near the current spot value:

Bitcoin Support

Here, the size of the dot represents the number of tokens that the addresses bought between the corresponding price levels. From the graph, it’s apparent that the $60,300 to $62,100 range has a particularly high density of coins right now.

Most of the price levels in this range lie just below the current spot price of the cryptocurrency, meaning that the investors who bought here would be making some profit, albeit only a slight one.

Generally, when the price retests the cost basis of such investors who were in profit prior to the retest (meaning that the price has approached their cost basis from above), a buying reaction may be produced by these addresses.

This is because holders like these may have reason to believe that if they were able to get into profits before, they might be able to do so again in the near future, so they may just accumulate on this “dip.”

Such a reaction can naturally provide support to the cryptocurrency. The scale of this support, however, is naturally not anything significant if only a few investors bought at the level to begin with. Narrow ranges that are thick with addresses, on the other hand, might just prove to be a source of noticeable support.

In the aforementioned price range near the current spot price, one million addresses acquired a total of about 671,000 BTC. “This accumulation zone highlights strong investor confidence and could serve as a crucial level of support for BTC, potentially cushioning against further drops,” notes the analyst.

While the price ranges under the current price are heavy with coins, it’s visible in the chart that this isn’t the case for the ranges above. Just like how supply wallets below can be a source of support, they can instead act as resistance when above.

The fact that the supply walls above are quite thin suggests that there wouldn’t be too many investors waiting to quickly exit at their break-even, and thus, selling pressure due to them should be low.

That said, it doesn’t mean there isn’t any impedance at all. Bitcoin is approaching all-time highs at this point, meaning that the vast majority of the supply is in profit. At these levels, mass selling for harvesting these gains can be the main challenge preventing the run from continuing.

BTC Price

At present, Bitcoin is trading around the $62,000 level, meaning that it’s right on the edge of the major support wall.

Bitcoin Price Chart

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Bitcoin Crash To $38,000: Here’s What Could Trigger It

Data shows Bitcoin is losing a major region of on-chain support with its latest plunge. Here’s the range where the next zone lies for the asset.

Bitcoin Has Slipped Under $41,200 To $42,400 Support Region

As explained by analyst Ali in a post on X, BTC has slipped under a key on-chain support zone today. An “on-chain support” range refers to a price below the current spot price of the cryptocurrency that hosts the cost basis of many investors.

For any holder, the cost basis, the price at which they bought their coins, is a fundamental level, as a retest of it by the cryptocurrency can change their profit-loss balance.

Investor psychology works such that if this retest of the cost basis happens from above (meaning that the holder had been carrying profits before this), the holder might react by buying more of the asset because they may believe this same price range could turn out to be profitable again in the future.

On the other hand, any investor who had been in a loss earlier could become likely to sell when the price reaches its break-even mark, as they wouldn’t want to miss out on the opportunity to escape without any losses if the asset happens to drop again shortly.

The individual investors’ reactions aren’t generally relevant to the market as a whole. Still, if many holders show this reaction at once, the combined force can cause fluctuations in the price.

Now, here is a chart that shows what the different price ranges look like for Bitcoin in terms of the number of addresses who bought at them:

Bitcoin Support And Resistance

As displayed in the above graph, the Bitcoin range between $41,200 and $42,400 is quite thick with investors. In total, 1.87 million addresses have bought 727,520 BTC at these levels.

Bitcoin has been moving in and out of this crucial support region the past day, suggesting that the zone may weaken. If the range gets lost, BTC might see an extended drop below towards the next major support zone.

The chart shows that the $37,400 to $38,700 range is where substantial on-chain support could next be available, as 1.28 million addresses have their cost basis.

Thus, Bitcoin may be at risk of declining to as low as $38,000 (the average price of the range) shortly. In the potential scenario of such a drawdown, the current $41,200 to $42,400 range could also become resistance, as these addresses would become loss holders desperate to leave.

BTC Price

Bitcoin slipped toward the $40,500 level during the past day but has since recovered to the $41,600 mark. It would appear that the support may not be entirely lost yet.

Bitcoin Price Chart