Bitcoin (BTC) is trading near a key support level that could set its short-term trend, according to a new analysis by CryptoQuant, which provides on-chain and market analysis tools for crypto traders.
A CryptoQuant analyst shared on Twitter a chart showing the actual price for Bitcoin's 1-3 month age band; this chart is calculated by dividing the market cap by the number of coins moving in that time frame. This indicator reflects the average cost basis of short-term holders and can act as a support or resistance level depending on price action.
Critical Level in Bitcoin is $27,200, According to CryptoQuant Analyst
According to the analyst, the realized price for the 1-3 month age band is currently at $27,200, which is slightly above Bitcoin's current market price of $27,093. The analyst warned that if Bitcoin fails to retrace this level, it could face a significant drop in the near future.
According to the analyst's statement, historically, when the BTC price gains momentum below this level, there is a big price drop.
He added that the next supports are found in the actual price of the 3-6 month age band at $25,300 and $20,000.
*Not investment advice.