Cryptocurrency News

Bitcoin rejects around $ 37.5K, with on-chain data showing surrender from short-term holders

Bitcoin began the week with a sudden rapid breakout at $ 37,500, a level that some analysts have identified as an analyst Important ‘line in the sand’, but the rally was short-lived as BTC had a selloff Low hand of recession signal Which can be viewed on multiple timeframes.

Although many traders are concerned that the bull market of 2021 is now over and looking at whether profits should be locked, on-chain data suggests that long-term bitcoin (B T c) holders are depositing in preparation for a capacity 2013-style double-pump Which has the potential to take BTC to a new historical height.

BTC / USDT 1-Day Chart. Source: Trading view

Ether (ETHOn the other hand, chatter about a possible ‘flipping’ between Bitcoin and Ethereum, as the move rose 8% to $2,677, remains a topic of discussion. Recently, Bloomberg estimated that Ether may one day overtake bitcoin As the world’s cryptocurrency of choice.

Short-term holders are feeding the sell-off

Glasnod’s recent “Week on-Chain” report can find more information about what feeds market uncertainty, which has seen the activity of short-term holders (STHs), who are about to enter a new market that coins Keep it short. More than 155 days, and Long-term holders (LTH) who have coins older than 155 days.

According to the Average Spending Output Lifespan (ASOL) metric, which provides insight into the average age of all UTXOs spent that day, LTH was primarily conducted through recent declines, as dramatized by ASOL. Was seen as evidence of fall from “$ 50,000 and $ 60,000 at levels below the observed accumulation range in between.”

Bitcoin average spent output lifetime. Source: GlassNode

Further proof that it is STH that are behind the sell-off, which can be found by comparing on-chain bitcoin transfer volumes in profit (LTH) to profit (STH).

According to Glasnod data, LTH were seen taking profits from $ 10,000 to $ 42,000 at the start of the 2021 rally, before their spending “reached a fairly stable baseline,” with their spending patterns “in line with last week’s selloff”. had little effect” indicating that “LTH is generally unwilling to liquidate coins at lower prices.”

This compares the behavior of STH, who “increased their spend by more than 5x during this sell-off, with the maximum spend occurring near the current local low of the market.”

Evidence of this can also be found in a review of the Spent Output Profit Ratio (SOPR) for STHs, which continue to realize losses by spending coins deposited at higher prices at current lower prices, indicating surrender. Give.

Short-term bitcoin holder SOPR. Source: glassnode

According to Glassnode :s

“Without a doubt, the current market structure is described as a battleground between bulls and bears, with a clear trend between long-term and short-term investors. fight with.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and business move involves risk, you must do your own research when making decisions.