Bitcoin STH Demand Is Growing – Here Are The Key Price Levels To Watch

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After a gentle price rebound last week, Bitcoin (BTC) rose above 98,000 with market bulls aiming to return to the $100,000 price zone. Interestingly, a report by CryptoQuant analyst Darkfost revealed an boost in demand among short-term holders, which coincided with the recent price boost.

Appetite for Bitcoin STH increases LTH selling pressure

In QuickTake post on Friday, Darkfost reports that long-term Bitcoin holders are experiencing a selling frenzy accompanied by increased demand from short-term holders. Based on market conditions, Darkfost explains that the current transfer of assets historically only occurs after a local market top or the top of a bull cycle, which indicates potential concerns for Bitcoin after the December price correction.

Analyzing the asset’s next move based on short-term asset holder activity that is currently driving demand in the market, Darkfost identified $85,000, the STH realized price, as a critical price area.

For context, the realized STH price represents the average purchase price of all BTC held by short-term holders. This often translates into a physiological zone capable of acting as a support or resistance zone.

As Bitcoin continues to trend higher, $85,000 should be considered an vital support level that could sustain the bullish trend in the event of a retest. Based on data for longer CPK acquisition periods, from 1 week to 6 months, other significant support levels include $81,000 and $60,000.

However, with the recent recovery in BTC, we are facing major resistance at $99,000, which represents the realized price for STH that has appeared within 1 week – 1 month. This is because once Bitcoin approaches $99,000, recent entrants to the market are likely to sell to recoup their initial investments, which could prevent further growth.

SOPR shows no profits for short-term holders

In other developments, Darkfost also notes that the Produced Profit Ratio (SOPR) for short-term holders is currently neutral at 1 following Bitcoin’s December pullback from $108,000.

This suggests that short-term holders are not selling for profit and will likely reduce selling pressure. As the LTH sell-off is also offset by rising demand from these STHs, market liquidity is likely to tighten, potentially preventing a full bullish market recovery.

Therefore, Darkfost predicts that BTC will remain in consolidation with the possibility of further price correction.

At the time of writing, Bitcoin is trading at $98,030 after rising 1.27% in the last 24 hours. Meanwhile, the asset’s trading volume dropped by 15.47% and is valued at $36.26 billion.

BTC trading at $98,086 on the daily chart | Source: BTCUSDT chart on Tradingview.com

Featured image from CNN, chart from Tradingview

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