Bitcoin was fighting to preserve gains after hitting $9,400 on July 22, as fresh macro tensions appeared to put strain on bulls.
Price tracker data on Wednesday showed a slight comedown for BTC/USD overnight, after the pair achieved its highest levels in two weeks.
At press time, Bitcoin was hovering near $9,350, recovering from a dip to the high $9,200s earlier on the day.
Stock markets, to which the cryptocurrency continues to show significant correlation, were wobbly amid fresh tensions between the U.S. and China. Uncertainty over the latest $1 trillion coronavirus stimulus package added to the sense of foreboding which saw markets shed value.
Speaking to Bloomberg, Morgan Stanley strategist Andrew Sheets warned of a “tough period” for equities coming up.
“I’m more concerned going into the August, September period: what’s going to then be the next catalyst to take the broader market higher,” he said on Wednesday.
Analyst: I’ll turn bearish on BTC at $9,230 close
For the meantime, news that the U.S. and China had likely entered into a consular closure war was impacting assets everywhere. Even safe havens fell, with gold and silver dipping lower in a contrast to recent successes.
Bitcoin still has room for maneuver, popular trader Josh Rager nonetheless concluded on Tuesday, with $9,230 the level to watch on the daily chart.
“Here we are again above the mid-range of the weekly closes between $10k and $8500,” he wrote in a fresh Twitter update.
“If price goes back under $9,230 on a close, I’ll start to lean more bearish as this compression can’t last much longer.”
Rager described a daily close above $9,450 as “good,” above $9,700 as “bullish” and cracking $10,000 as “semi-euphoric.”
Bitcoin’s burst to $9,430 went some way to breaking the compression channel that Rager and many others have mentioned in recent weeks. As Modern Consensus reported, the cycle of daily higher lows and lower highs has been long due for disruption.
Report: hodlers standing firm
Meanwhile, a new report released this week delivered fresh evidence about the overall strength of Bitcoin as an entity.
In The Network, the first such report by crypto research project Formal Verification, in particular highlighted growth in long-term BTC investment.
Using so-called HODL Wave data, founder Lewis Harland noted that the percentage of the Bitcoin supply which has not moved in more than a year now totals 62%—its highest since early 2016. 22% has not moved in more than five years—an all-time high.
Miners are also displaying behavior in line with historical patterns after each halving—both price and hash rate, which is an estimate of the computing power dedicated to transaction verification, have been broadly climbing since May.
As noted previously, average hash rate, along with Bitcoin network difficulty, have both seen all-time highs in recent weeks. Difficulty is scheduled to drop slightly at the next readjustment in six days’ time, having previously been on track to climb higher still several days ago.