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This is why Bitcoin is stuck below $28k resistance

This is why Bitcoin is stuck below $28k resistance

Although the price of Bitcoin (BTC) has seen a few bullish attempts, all of these have failed to break a crucial resistance, and one of the reasons is profit-taking by investors who have acquired the flagship decentralized finance (DeFi) asset at a certain level.

Specifically, investors who have bought Bitcoin at a level of $28,600, and have held on to it for between three and six months, have likely decided to realize their profits, according to the observations of analyst Axel Adler Jr. over at the cryptocurrency analytics platform CryptoQuant shared on May 18.

As the expert explained, the Bitcoin: Sum Coin Age Distribution chart, which shows the distribution of coin holders by their holding duration, indicates a massive decline after May 2, “pointing to a mass liquidation of assets by this cohort of investors.”

Bitcoin sum coin age distribution chart analysis. Source: AxelAdlerJr / CryptoQuant

Indeed, Adler Jr. concludes that such movements are “a typical reaction to a market reaching a probable local peak,” and the pressure on the price, which is the result of an increase in market sales volume, is “hindering further growth of Bitcoin.”

Bitcoin price analysis

Meanwhile, Bitcoin was at press time trading at the price of $27,366, recording an increase of 2.14% on the day, as it tries to reverse the losses of 0.44% over the previous week and 8.49% in the last month, according to the latest charts retrieved by Finbold on May 18.

Bitcoin 7-day price chart. Source: Finbold

Earlier, crypto trading analyst Michaël van de Poppe observed that Bitcoin would need to flip the $27,500 level to trend further upwards after breaking out of the must-hold zone between $26,800 and $27,000, which, according to him, was the make-it-or-break-it area for the maiden crypto asset.

Interestingly, the number of Bitcoin addresses holding one whole BTC or more has surpassed a record-breaking milestone of one million on May 13, indicating a consistent growth in the adoption of the largest crypto by market cap, as Finbold reported on May 16.

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