- Bitcoin’s long term holders offloading BTCs to realize profits, which dominated no effect on bullish behavior of Bitcoin
- LTHs are gaining profits before the market peaks
- BTC/USD will continue to earn profits, but it cannot be claimed as how the market top performs
This year has been blissful in the financial world after facing a bearish movement for quite some time. Bitcoin has shown a significant jump this year after the halving event. Around July 26, 2020, BTC started its bull run after breaking its resistance at $10,000. Five months later, bitcoin almost doubled up and reached around $20,000 for the first time since 2017.
Why does Bitcoin show Bullish movement even after LTH sells?
Bitcoin is trending No.1, which shows a bullish run in the crypto market despite long-term holders are offloading bitcoins from the market on a large scale conceivably to realize profits. Preferably bitcoin was expected to show bearish behavior after such a transaction from LTHs, but instead, Bitcoin continues to run bullish. An on-chain market intelligence platform, Glassnode uses distinguished tools and indicators to culminate that older authoritative coins are currently moving in the market even if Bitcoin shows high prices.
ASOL acronym for Average Spent Output Lifespan (7-day moving average) proclaims Bitcoin’s similar behavior in 2020 like in 2017. Spike showed in ASOL propounds that older coins are currently in movement, indicating that long term holders realize profits to be precise in language.
ASOL trails the real economic activity, not giving much importance to house transactions, which brings improvised market signals instead of raw data from the Unspent Transaction Output (UTXO) version.
What’s the reason behind the increase in profit but no effect on the supply of BTCs?
It is a crucial point to keep in mind that profit has risen significantly. But it hasn’t brought any change in the supply of Bitcoins. In layman’s language, most of the long term holders purchased bitcoins when it was under $10,000 and continued it to hold all the way when bitcoin started its bullish behavior. According to a sharp spike in ASOL towards the end of November shows that LTHs unshipped approx 200,000 Bitcoins to acquire profits. Around November 17, Bitcoin prices were around 17,670, and since then, in such a short span of time, the cost of BTC rose up to 9%, currently holding bitcoin for $19,500. This shows that despite selling BTCs, it does not affect the bullish behavior of BTC.
Bitcoin price tends to rise even if the long term holders are offloading bitcoins because consequently, it is just creating room for the new investors to pool their money in Bitcoin.
It is a prominent point to keep in mind that these holders can realize profits before and during a bullish run. This generally means that the long-term investors seek reasonable profit booking prices above the all-time high of the crypto asset.
The above analysis shows the profit is realized before the market peak. It cannot strictly hypothesize how far the market is to be on top. According to the behavior which bitcoin is showing currently, the price will likely rise high in the future, stated research analysts.
Bitcoin will continue to show bullish behavior if it sustains above 50 DMA.
For the time being, Bitcoin appears to be laying its guard down for the consolidation ahead of another remarkable breakout. The Bollinger bands doubled down on this forward-looking breakout. For now, Bitcoin performing around $19,000 is a bullish run, especially facing a hindrance around $19,500.
According to 50 SMA, if Bitcoin slides under $19,000, sell orders are likely to gush out, creating enough volume to push BTCs to lower levels of $18,000 according to 100 SMA. The recovery will only be possible when there is a new room built for the buyers.
Join The Coin Republic’s Telegram Channel for more information related to CRYPTOCURRENCY NEWS and predication.
We are sorry that this post was not useful for you!
Let us improve this post!
Tell us how we can improve this post?