How Bitcoin can break out of its current price trend

  • At its press time price, BTC was “stuck” between short-term and longer-term realized prices.
  • For market sentiment to improve, its price had to rally above the short-term realized price.

The sentiment around Bitcoin [BTC] is likely to improve once its price surpasses the realized price of short-term holders (LTHs), pseudonymous CryptoQuant analyst SignalQuant opined in a new report. 

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BTC’s realized price refers to the average price at which all Bitcoins have been moved over their lifetime. When the realized price is above the market price, it means that market participants are in profit on average.

Conversely, coin holders are at a loss when the realized price is below the current price. 

For BTC short-term holders (STH), their realized price refers to the average price at which coins purchased in the last six months were acquired. For long-term holders (LTH), it is the average price at which all coins that have not been moved in the last six months were originally purchased.

Data retrieved from Glassnode showed that as of 12 September, BTC’s realized price for its short-term holders was $27,975.

According to SignalQuant, this price mark acted as a support level for the king coin in January before bearish sentiments overran the market, turning the same into resistance. 

glassnode studio bitcoin short term holder realized price and mvrv

Source: Glassnode

As for long-term holders, their realized price was $22,400. At its press time price of $25,956, BTC exchanged hands between the two realized prices.

According to SignalQuant:

“BTC’s price needs to stay above LTH realized price and then break back above STH realized price for the “short- and long-term investor sentiment” to really recover.”

This would signal to investors that the bear market is over and that the BTC price will likely continue to rise.

Network activity continues to climb

Although BTC’s price continues to face resistance at $26,000, new demand grows unabated. On-chain assessment of the coin’s network activity revealed a 5% jump in the daily count of new addresses created to trade the leading coin in the last week.

In fact, on 9 September, 717,331 new addresses were added to the coin’s network, its highest daily count in the past five years. Moreover, data from IntoTheBlock also showed an 11% rally in daily active addresses within the same period. 

ITB btc daily active addresses bitcoin 2023 09 13T09 16 57.088Z

Source: IntoTheBlock

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There has been a notable surge in the count of shark and whale BTC transactions completed daily. According to IntoTheBlock, BTC transactions worth between $10,000 and $100,000 have increased by 8% in the last 30 days.

Whale transactions worth between $100,000 and $1 million have also increased by 6% in the same period.

ITB transaction count by size undefined 2023 09 13T09 09 30.786Z

Source: IntoTheBlock

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