Bitcoin (BTC), the largest cryptocurrency in the market, reached a new yearly high last week. However, since then, it has been trading within a new range between $29,500 and $30,000, failing to consolidate above this key level and continue its rally towards higher territories.
According to new data analyzed by Satoshi Club, a leading cryptocurrency platform, Bitcoin has built a strong foundation below $30,000, with the current supply structure resembling that of early 2016 and 2019. This news comes as a promising sign for bulls, suggesting that Bitcoin’s future may be brighter than previously thought.
Is Bitcoin Poised For New Highs?
According to Satoshi Club, the supply distribution of Bitcoin has been split into two: pre-FTX collapse for long-term holders (LTH) supply and post-collapse for short-term holders (STH) supply. This has resulted in LTH supply near all-time highs for several months or even a year.
Furthermore, according to Satoshi Club, BTC’s Long-Term Holder supply has reached a new all-time high of 14.161 million BTC. Meanwhile, the Short-Term Holder supply remains steady at 2.914 million BTC.
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The most recent bull runs in 2016 and 2019 took 18-24 months to start, and during those times, Bitcoin saw a quick spike in long-term holdings in profit, followed by profit-taking. Currently, Bitcoin is experiencing strength in its price, with year-to-date (YTD) gains backed by an “explosive uptick” in coins held at a profit.
This means that more and more investors are holding onto their BTC, as they are currently in profit. This is a positive sign for the market as it indicates that investors have faith in the long-term potential of Bitcoin.
Additionally, Satoshi Club highlights that in the current market environment, the foundation of Bitcoin appears to be much stronger than in previous bear markets. In 2023, 6.2 million Bitcoin returned to profit, which represents 32.3% of the total supply. This indicates a strong cost basis foundation below $30,000, which is a positive sign for the long-term prospects of BTC.
Moreover, according to Satoshi Club, Bitcoin is unlikely to visit prices below $15,500 in the short term. This prediction is based on the current supply structure of Bitcoin, which indicates that there is significant support for the cryptocurrency at this price point.
BTC Bulls Rejoice
CryptoQuant, a leading crypto market data analytics platform, has released an analysis on the use of the “net volume” movement in predicting Bitcoin price fluctuations in the futures market. The analysis suggests that using a 72-day moving average to analyze the difference between long and short position volumes can help to some extent in predicting BTC price fluctuations.
According to CryptoQuant’s analysis, the current Bitcoin position in the futures market is similar to what was observed in November and December 2020. From a sentiment perspective, the potential for Bitcoin’s price to rise is greater as increasing short positions are being liquidated.
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At the time of writing, the largest cryptocurrency in the market is trading at $30,000 and has been trading sideways for the past 24 hours. However, if BTC can maintain its current trading zone, there is potential for it to bounce from the support level and reach new yearly highs.
Featured image from Unsplash, chart from TradingView.com