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The recent decline in Bitcoin’s price to below $60,000 has sparked discussions about the possibility of the asset’s remarkable bull run this year concluding sooner than anticipated.
However, Lead Glassnode analyst James Check asserts that bulls have minimal cause for concern.
Bitcoin’s Pullback: Dip Or Doom?
In a video analysis shared on Friday, Check examined various on-chain metrics related to short-term Bitcoin holders, who acquired their coins within the last five months.
Initially, Bitcoin’s short-term holder MVRV ratio is approaching 1.0, indicating that unrealized profits and losses have reached a break-even point. This threshold can act as support following a dip in a bull market, but it can also present significant resistance during bear markets when many Bitcoin holders are at a loss.
“Minor pullbacks are beneficial,” Check remarked. “In 2023, we experienced several of these retests. If we consider this a robust uptrend, we should anticipate the short-term holder cost basis to remain stable, likely in the $58,000 to $59,000 range.”
In a similar vein, the short-term holder SOPR has recently fallen below 1.0, indicating that short-term holders are starting to incur more losses than gains. If SOPR drops significantly below this level without recovering, it could signal the onset of a prolonged bear market.
This week, realized losses among short-term holders have surged considerably—a sign that new buyers were panic selling at a loss in response to escalating tensions between Iran and Israel.
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“This is essentially what you want to observe, as a contrarian,” Check added. “As a contrarian, you tend to prefer seeing individuals making poor decisions at inopportune times.”
Recently, Check indicated that Bitcoin’s price might become “top-heavy” if it falls below $58,800. The asset is currently trading at $64,000.
Bitcoin’s Long Term Momentum
Other indicators, such as the AVIV momentum indicator, suggest that Bitcoin’s price momentum remains favorable over longer periods, merely undergoing a cooldown on the 30-day timeframe for a “proper reset.”
The AVIV Momentum indicator continues to show positive readings, with all timeframes reaching higher levels with each successive peak.
A cooldown is currently taking place on the quicker 30-day indicator, which is desirable for an effective reset. https://t.co/hk4UJ1FZ7x pic.twitter.com/aSDhff53AM
— _Checkmate
(@_Checkmatey_) April 18, 2024
Concerning the Bitcoin halving itself, Check believes its financial implications may be overstated. In comparison to Bitcoin futures volume, spot volume, and ETF trading volume, the daily BTC issued to miners constitutes a minuscule portion of the market.
“The significance of the halving is more of a narrative than a substantial factor now… it’s just very, very small,” he stated.
The post Is The Bull Market Over Before The Bitcoin Halving? Glassnode Report appeared first on Cryptonews.
