According to data provided by IntoTheBlock, Bitcoin's drop below the $42,000 zone will open a direct path to $37,000 due to the absence of strong support zones. At the same time, to reach the pleasurable $47,000 zone, Bitcoin will need to break through the 1.9 million BTC resistance zone.
Source of selling pressure
While the In/Out of the money indicator will not give a signal as to the appearance or disappearance of selling pressure on the cryptocurrency market, it could still be used to determine the potential resistance the asset may face on its way up.
Since investors tend to take profits or de-risk their portfolio whenever an asset reaches its initial entry price, Bitcoin may face its highest selling pressure between $42,000 and $43,000, and between $45,000 and $47,000.
$BTC analysis— IntoTheBlock (@intotheblock) January 7, 2022
As #Bitcoin drops below $42,000, the IOMAP reveals there's little support that could prevent from falling until $37k
On the resistance side, BTC is facing stiff resistance ahead. In order to reach $47k again, it must surpass over 3.2m addresses holding 1.9m BTC pic.twitter.com/3feQYnwxrn
Both zones are acting as concentrations of 3.2 million addresses that hold 1.9 million BTC. The metrics show that each zone is wider than the other whenever it concentrates more addresses that have received assets at a specific price.
According to the same metric, the biggest support zone for the asset currently stays between $39,000 and $41,900, with approximately one million addresses holding 700,000 BTC. The sudden drop in the number of holders appears in the zone between $38,000 and $39,000, with less than one million addresses holding Bitcoin at a profit.
After the most recent correction on the market, Bitcoin's profitability has dropped to 57%, with 36% of all holders trading or holding Bitcoin at a loss. At press time, Bitcoin is trading at $41,585 and losing 3.8% of its value during the day.