Glassnode is an analytics company that specializes in on-chain data. They have explained why the Bitcoin trend continues to be positive so long as Bitcoin trades at a price above its short-term cost of ownership.
Bitcoin Is Still Maintaining Above Short-Term Holder Realized Price
It’s a brand new world post Glassnode discussed the price of Bitcoin for short-term investors on X. The “Realized Price”The indicator is used to track the average investment cost or the address of an investor on the BTC system.
When the value of the metric is greater than BTC’s spot price, it means the investors as a whole are sitting on some net unrealized profit. On the other hand, it being under the asset’s value implies the overall market is in a state of net loss.
The Realized Price for a particular segment of users is important in the context of this topic: short-term holders (STHs). This group includes investors who bought their tokens in the past 155 day.
Here is the graph shared by Glassnode which shows the trends in Bitcoin Realized Prices for STHs.
Bitcoin, as can be seen in the graph below, retested STH’s Realized Price and found it to be a strong support. Since then, the coin’s price has seen some recovery.
Many times, this pattern has shown up in STH’s Realized Price as a Support Barrier. bull market. Investor psychology may be the reason for this pattern.
Statistically, the longer an individual holds on to their coins, they are less likely to want them later. Since the STHs have a relatively low holding time, however, they don’t tend to be resolute, and thus, easily make panic moves when shifts occur in the market.
STHs are particularly vulnerable to panic if the crypto currency re-tests its breakeven level. The reaction is to buy when the mood of the market is positive. STHs see drawdowns of their cost-basis as an opportunity to dip buy.
STHs also react by selling their assets during periods of bearishness, fearing the asset will decline in the future.
Bitcoin’s price is currently above STH Actualized Price. “As long as the price respects this level, the trend remains constructive,”The analytics company notes. “Losing this support has coincided with phases of contraction or pullbacks.”
BTC price
Bitcoin was trading at $116.200 as of the writing. This is an increase of almost 5% in the past seven days.
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Source: www.newsbtc.com
