Despite Cautiously Rising, On-Chain Data Says Bitcoin Is Due for a Steep Correction

Key Takeaways

  • Bitcoin broke out of an ascending triangle, suggesting an upswing towards $11,400.
  • Although there isn’t any supply barrier ahead that could hold surging prices at bay, data shows that large investors have been offloading their BTC.
  • Meanwhile, a particular technical index is flashing sell signals on multiple time frames that could lead to a steep correction.

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The pioneer cryptocurrency continues trending upward despite mounting uncertainty in the market. While data shows Bitcoin has more room to go up, different metrics suggest that a correction may come before it advances further.

Bitcoin Rises Steadily, Aiming for $11,400

Bitcoin appears to have broken out of an ascending triangle that was forming on its 4-hour chart following the 19% drop seen at the beginning of September. Slicing through the x-axis of this consolidation pattern suggested that BTC was poised to surge over 7% to reach a target of $11,400.

Such a bullish target was determined by measuring the triangle’s highest points and adding that distance to the breakout point.

Bitcoin US dollar price chart
BTC/USD on TradingView

While prices have been steadily rising over the past few days, one particular on-chain metric indicates that nothing will prevent the flagship cryptocurrency from achieving its upside potential.

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IntoTheBlock’s “In/Out of the Money Around Around Price” (IOMAP) model shows no significant supply barriers ahead that would obstruct a further advance towards $11,400. But moving past this hurdle will likely be difficult as 1.2 million addresses purchased over 720,000 BTC around this price level.

In/Out of the Money Around Around Price by IntoTheBlock
In/Out of the Money Around Around Price by IntoTheBlock

Regardless of the optimistic outlook, Santiment’s holder distribution chart reveals that large investors have taken advantage of the upward price action to realize profits. The behavior analytics firm recorded a significant decline in the number of addresses with millions of dollars in Bitcoin, colloquially known as…

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