Bitcoin price performance over the past month has been quite disappointing. The flagship cryptocurrency struggled to break above $70,000 throughout February, with the price facing a sharp reversal after reaching $71,000.
It then becomes intuitively clear that this price area could be a key level that acts as resistance to Bitcoin’s bullish attempts. Here are some important levels to watch in March and what they could potentially mean for the price of Bitcoin.
BTC realized price is $54,600 – what this means
In a Quicktake post on the CryptoQuant platform, market analyst Burak Kesmeci highlighted five “cost clusters” that could reveal the next move in Bitcoin price. For context, a cost cluster is essentially a price level that represents the average acquisition price of an asset (in this case Bitcoin) by a diverse group of investors.
First of all, Kesmeci immediately stated that the most obvious support price (realized price) for Bitcoin is around $54,600. The realized price is a strong area of support as it reflects the average cost basis of all BTC in circulation.
Source: CryptoQuant
Additionally, realized prices have historically served as long-term price support during bearish phases. As a result, when the Bitcoin price is trading above this level, it is often a sign of existing structural strength, while a decline below the realized price is usually a sign of impending doom.
Bitcoin could turn bullish in March, but not in these terms.
Bitcoin price may be supporting a higher period, but it is also true that the world’s leading cryptocurrency is fighting a series of battles as it rises. According to cryptocurrency experts, four resistance zones are waiting to deny any possibility of an upward recovery.
The first area is the 1-4 week realized price, which represents the average price at which buyers have recently entered the BTC market. According to highlighted CryptoQuant data, this cost basis is around $71,600.
When the price of Bitcoin trades below this level, it is a sign that recent participants are in extreme heat. Therefore, attempts to recover towards this price level will typically face significant resistance as this group wants to exit at breakeven.
The analyst highlighted that STH RP (Short Holder Realized Price) is around $90,800. This concerns investors who have held BTC for less than 155 days. If the Bitcoin price overcomes the apparent resistance at this level, it could signal a change in Bitcoin’s trend from bearish to bullish.
Beyond STH RP, the 365-day simple moving average occupies the $98,900 price level. Then a little further north, the 3-6 month realized price is around $100,800. These indicators reflect the activity of Bitcoin medium-term holders, showing realized and average closing prices over the past year.
In the grand scheme of things, Bitcoin is clearly in a bearish phase. Therefore, BTC will need to overcome these important resistance levels before March becomes an important month for market participants. As of this writing, Bitcoin’s value is around $63,696, reflecting a decline of more than 5% over the past 24 hours.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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