Bitcoin‘s long-term holders are demonstrating low selling pressure, which is a positive sign for the cryptocurrency’s bullish outlook. According to Ki Young Ju, the CEO of CryptoQuant, around 71% of the realized capitalization of Bitcoin has remained unmoved for over six months, indicating that long-term holders are not rushing to sell their BTC holdings. This lack of selling pressure contributes to the reduced selling pressure in the market. While low selling pressure doesn’t guarantee an immediate price increase, it does suggest that BTC is less likely to be at its cyclic top, providing a positive sign for investors and enthusiasts alike.
Bitcoin Long-Term Holder Supply has achieved a new all-time high of 14.52 million BTC, equivalent to 75% of the circulating supply. This suggests that HODLing (holding onto Bitcoin for the long term) is the preferred market dynamic amongst mature investors. Notably, data by the firm shows that long-term holders, or addresses that hold coins for 155 days or more, currently control roughly three-quarters of the total Bitcoin in circulation (19.43BTC).
Another analyst at Cryptoquant, “IT Tech,” has recently offered valuable input on Bitcoin’s behavior during bull and bear markets. The pundit highlighted the Long Term Holder SOPR (SMA 30) metric, emphasizing the significance of “level 1” as a key indicator in distinguishing between the two market phases. According to him, in a bear market, level 1 (circled in yellow) acts as resistance, while it transforms into solid support in a bull market. Historic data from 2016 and 2020 showed that after crossing and holding level 1, Bitcoin entered the early bull market phase. The one exception was the period between 2019 and 2020, marred by the black swan event. The 30 SMA has since moved above the level, signaling the early phases of a bull market.
Despite the positive indicators, Bitcoin’s price remains just below $30,000, and the upcoming US Federal Reserve’s decision on a 25-basis point rate increase is creating market uncertainty. Last month, the price attempted to push higher following numerous ETF applications led by BlackRock, fueling hopes of institutional investments before falling back into the current range. Nevertheless, experts remain confident that the ongoing weakness will be short-lived, with analyst Plan B predicting massive institutional buying, which will further prop up Bitcoin’s price.
Source: ZyCrypto
