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A recent Quicktake evaluation on the on-chain analytics platform CryptoQuant highlighted how Bitcoin’s short-term holders’ (STH) behaviour is analogous to that of 2019. This evaluation comes as Bitcoin stays below $60,000, continuing the bearish September trend.
Peak In Bitcoin’s Short-Term Holders Similar To 2019 Structure
CryptoQuant contributor Avocado_onchain noted that there had been a “small peak” in Unspent Transaction Outputs (UXTOs) under six months, which resembles an identical structure observed in 2019. The analyst explained that these UXTOs under six months are recent investors (or short-term holders) who entered the market around March of this 12 months when Bitcoin’s price hit a recent all-time high (ATH).
In line with the analyst, the declining proportion of those UXTOs suggests that these investors have either exited the market as a consequence of Bitcoin’s choppy price motion since March or have held and now transitioned to long-term holders (UTXOs of six months and above).
Source: CryptoQuant
The accompanying chart showed that an identical structure occurred across the halving event in 2019 when Bitcoin also reached a neighborhood high. After that, Bitcoin’s price cooled off and took almost 490 days to hit a recent ATH, although Avocado_onchain noted that there was also the impact of the COVID-19 pandemic.
This development undoubtedly provides insights into what Bitcoin investors could expect from the flagship crypto in the long run, despite the fact that its price stays choppy. Avocado_onchain remarked that he’s confident about Bitcoin’s long-term upward trend. Nonetheless, within the short term, he believes it’s going to be smart for investors to “temper expectations and closely monitor the market.”
Meanwhile, although the analyst admitted that there isn’t any clear trigger for a Bitcoin breakout, he noted that the influx of capital from recent investors has historically been vital for Bitcoin’s price increases. Bitcoin hit a recent ATH in March following the launch of the Spot Bitcoin ETFs, which introduced recent money into the Bitcoin ecosystem.
Bitcoin Looks To Proceed Bearish September Trend
Bitcoin looks to proceed its bearish September trend this 12 months, with the flagship crypto already down by over 4% because the month began. Historically, September is understood to be a bearish month, as data from Coinglass shows that Bitcoin has suffered a monthly loss in six out of the last seven September, dating back to 2017.
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Following his simulation of Bitcoin’s price for this month, CryptoQuant’s Head of Research, Julio Moreno, mentioned that, on average, the flagship crypto could end the month at $55,000. Moreno had earlier mentioned that a drop below $56,000 for Bitcoin puts the crypto liable to a deeper price correction and entering a chronic bearish phase.
Source: CryptoQuant
For now, the crypto community hopes that the US Federal Reserve will cut rates at its next FOMC meeting, which is scheduled for September 17 and 18. A rate cut is believed to be one that might trigger Bitcoin’s price and result in a successful breakout above $60,000.
On the time of writing, Bitcoin is trading at around $56,400, down over 4% within the last 24 hours, in response to data from CoinMarketCap.
BTC price touches below $56,000 | Source: BTCUSD on Tradingview.com
Featured image created with Dall.E, chart from Tradingview.com