The price exceeds $40.
Bitcoin experienced a significant drop in price on January 19, reaching a 40-day low of $40,700. This decline has raised concerns that if Bitcoin loses support at the $40,000 level, major liquidations could occur.
Since the highly anticipated spot ETF approval decision, Bitcoin has been trading sideways. However, on January 19, another wave of selling pushed prices down to $40,000 for the first time since mid-December.
Despite this decline, on-chain data indicates that miners stepped in to defend the crucial $40,000 support level. Cryptoquant’s miner reserve metric shows that miners increased their holdings by 12,058 BTC on January 19 alone, equivalent to approximately $494 million at current prices.
Miners play a significant role in the cryptocurrency ecosystem, and their buying trend could help maintain retail investors’ confidence and prevent panic selling.
In addition to miners, bullish traders in the Bitcoin derivatives markets are also showing resilience amid the price slump. Despite the 7% drop in BTC price within the daily timeframe on January 19, the BTC open interest only decreased by 2%. This suggests that traders holding long contracts are doubling down on their positions, anticipating a quick rebound in the spot markets.
The data shows that instead of closing their positions as prices dropped, Bitcoin miners and bullish derivatives traders have invested millions to defend their positions.
The decline in BTC price below $41,000 has raised concerns about triggering stop-loss and margin call orders if it falls below $40,000. However, the significant acquisition of $482 million by miners and the defense of long positions by derivatives traders could create enough demand to keep BTC above $40,000.
Furthermore, the in/out of the money around price data from IntoTheBlock indicates that BTC has strong support in the $40,000 range, with 679,910 current addresses holding 313,000 BTC at the maximum price of $40,313. If this support holds, it is likely that BTC will avoid further decline below $40,000 in the short term.
On the upside, if Bitcoin can surpass the $45,000 barrier, it could regain control of the market.
