- BTC has made a moderate price hike over the past day, rising by 1.02%.
- Bitcoin’s long-term holders have reduced selling by 60% as they eye $120k.
Although Bitcoin’s [BTC] has struggled to reclaim higher resistance, long-term holders remain in profit. Despite profitability remaining intact for long-term holders, they have reduced their profit taking, according to Axel Adler.
In his analysis, Adler observed that long-term holders have reduced their spending by 60% compared to the $90-100k level. At the current rates, it’s down by 40k BTC per day.
Source: CryptoQuant
This means long-term investors are holding onto their Bitcoin instead of selling, reflecting higher confidence in future price increases.
This shift in sentiment among long-term holders is significant. Fewer coins entering the market reduce selling pressure.
With reduced selling pressure between $90-100K, long-term holders are now eyeing $120K to start selling again.
At this price level, LTHs will sell because they would have secured a 500% profit on their Bitcoin investment. Therefore, despite the market conditions at this level, the rising profit margin will entice them to sell.
If BTC hits $120K, the market could experience massive selling pressure as LTHs start to take profits.
What BTC charts suggest
As observed above, Bitcoin’s long-term holders have reduced their selling. This trend is evident as Long-Term Holder SOPR has dropped from a high of 5.7 to 2.7 over the past 10 days.
Source: CryptoQuant
While long-term holders (LTHs) are still selling at a 2x cost basis, they are not selling as much. Previously, BTC traded above $100K with LTH SOPR remaining above 2.5 but below 3.
If the SOPR continues to rise and surpasses 3, an increased profit-taking behavior could be observed, leading to price drops.
Source: Bitbo
Additionally, Bitcoin’s Mayer Multiple has declined to 1.2 meaning BTC is trading near its 200-DMA which is within its fair value.
When Mayer’s Multiple is moderate, long-term holders reduce accumulation but are still holding strong.
As such, the current price level provides a better opportunity for LTHs to accumulate rather than sell.
Source: IntoTheBlock
Bitcoin’s Large Holders Netflow to Exchange Netflow Ratio has reduced from 5.59% to 0.92% over the past two weeks.
This drop implies that large holders are transferring less of their BTC holdings to exchanges, meaning they are not selling as much.
Since most whales are also LTHs who accumulate during bear markets and sell in bull markets, this reflects less profit-taking behavior from this group.
In conclusion, the prevailing market conditions suggest that profit-taking behavior is cooling down, especially among long-term holders. When LTHs reduce profit-taking activity, it reduces selling pressure, which helps drive prices up.
If this trend among LTHs continues, it will strengthen Bitcoin to reclaim $100K levels.
However, with sellers still active from both ends, BTC could continue trading sideways until it finds momentum for another upswing.
