Bitcoin Market Experiences Shift with Long-Term Holder Selling Pressure
The Bitcoin (BTC) market is experiencing shifts in supply dynamics, with significant activity between long-term holders (LTHs) and short-term holders (STHs). According to an analysis from CryptoQuant, such transitions historically indicate local market tops or potential cycle peaks based on the broader market environment.
Currently, demand from short-term holders plays a critical role in supporting Bitcoin’s price stability amid ongoing market volatility.
Long-Term Holders Vs. Short-Term Buyers
CryptoQuant analyst Darkfost indicates that recent short-term holders are influencing market sentiment. Analyzing the realized price data reveals distinct support and resistance levels.
Key realized price levels include $41,000 as the general average, $85,000 for short-term holders overall, $99,000 for those holding one week to one month, $81,000 for one to three months, and $60,000 for three to six months. These levels represent psychological and technical points where significant buy or sell decisions may occur.
The Short-Term Holder Spent Output Profit Ratio (STH SOPR) is currently neutral at 1 after declining from Bitcoin’s last rally to an all-time high of $108,000. A neutral SOPR suggests that recent selling by short-term holders has not been significantly profitable, reducing incentives for widespread sell-offs at current price levels.
This neutral stance indicates potential challenges for immediate bullish recovery, as declining STH SOPR signals diminishing realized profits, which could slow upward momentum in the short term. Despite these challenges, demand from short-term holders has absorbed much of the selling pressure from long-term holders, preventing sharp price declines. Darkfost concluded:
In conclusion, the selling pressure from LTHs has so far been fairly well absorbed by the buying pressure from STHs. However, we note that the STH SOPR is declining, which could hinder an immediate bullish recovery. In the short term, a period of consolidation or even a deeper correction might occur.
Bitcoin Market Performance And Outlook
Bitcoin is currently trading at $97,357, reflecting a slight increase of 1.1% over the past day. While this uptick has helped BTC regain positive momentum recently, it remains insufficient to reach the six-digit price mark or its all-time high above $108,000.
Featured image created with DALL-E, Chart from TradingView