Tug-of-war between newbies & top 1% has Bitcoin range-bound

Like the little Coinbase QR code that bounced around within the outlines of your TV during the Super Bowl, Bitcoin’s been stuck in a stubborn trading range for months. Some market-watcher have a theory as to what might be going on. 

Consider this explanation: long-term investors are wading in whenever prices fall, according to Brett Munster at Blockforce Capital. “This group of market participants have been repeatedly willing to step in and accumulate coins at these lower prices, thus setting a floor for Bitcoin over the past couple months,” he wrote. 

On the other hand, short-term holders are underwater as long as Bitcoin stays below $47,000, and most are currently holding their coins at a loss. “Every time we start to approach that mark, there appears to be increased sell pressure likely caused by those investors excited to simply get their initial investment back,” Munster, who analysed Glassnode data, said.

The result? Bitcoin’s been clinging to a range between $32,000 and $47,000, which is proving tricky to break out of. 

Matt Maley, chief market strategist at Miller Tabak + Co., has noticed the trend too. “The long-term players are keeping a bid under the market,” he said. “However, a lot of people who bought Bitcoin last year are underwater. They seem to be using every bounce as an opportunity to take some chips off the table with so much uncertainty surrounding its ability to become a hedge against inflation.”