Before the weekly close, the correction of the first positive signs could be completed

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About two days ago, the price of bitcoin fell to an intraday low of $ 55,640 (on Bitstamp), causing moderate unrest within the community and raising the question of how far the correction will go.

As we reported at the time, one of the key levels to consider is the area between $ 58.3K and $ 53K, as it contains very strong support in terms of technical indicators and in chain.

Now, prominent Bitcoin analyst Daniel Joe has noted on Twitter that the cryptocurrency has plunged into this major accumulation zone while also printing a moderate hammer candle and continuing higher.

Chart by TradingView

According to the analyst, “this is a short term positive development for techniques, but we need to see higher ups and downs for validation.”

We have noted on more than one occasion that the current decline is mainly caused by the liquidation of leveraged long positions and the panic of weak hands mostly selling newer coins. Long-term holders (LTHs) and miners, on the other hand, have held their ground and show no serious interest in selling at these levels.

This is firmly evidenced by the fact that the Average Coin Age (MCA) has trended upward for a considerable period, despite some short-term declines, as shown in the graph below:

Chart by CryptoQuant

The analyst also notes that he thinks this is a great buying opportunity as there are no serious signs of aggressive distribution from old coins and miners as the price was falling.

Chart by CryptoQuant

I think this pullback is a solid buying opportunity as we saw no major signs of aggressive distribution from older coins and miners as the price fell.

So this is probably an upheaval in the middle of the bull market.

It’s always amazing to pile up at times like this. Thank the long levers and weak hands for causing short-term price dislocations. – Joe concluded.

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TradingView cryptocurrency charts.

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