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On-chain data shows that Bitcoin is approaching a “realized price” for short-term holders, the retest of which has historically been important for Bitcoin.
Bitcoin is close to seeing a retest of its holder cost basis in the short term
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the “Realized priceHere it refers to an on-chain indicator that tracks, in short, the average price at which investors or addresses on the Bitcoin network received their coins.
When the spot price of a cryptocurrency is above this measure, it means that the average holder of the coin in the market is currently making some profits. On the other hand, the value of BTC under the indicator indicates the predominance of losses among investors.
Of course, when the two are exactly equal, it can be assumed that the market as a whole retains an equal amount of unrealized profits and losses. Bondholders can collectively be considered just breaking even on their investments.
In the context of the present topic, the focus is on the realized price of only a specific part of the sector: Short Term Holders (STHs). STHs are investors who have purchased their coins within the past 155 days.
Below is a chart showing the trend in the realized price of Bitcoin STH over the past two years:
The chart above shows that the price of Bitcoin is close to the realized price of STHs. This means that the margin is small, even though these investors are making profits at the moment.
Therefore, it is possible that if the cryptocurrency continues its recent downward trajectory, A exam REPETITON From an average cost basis for this group could be forthcoming. In the past, these retests have proven to be relevant to the original.
Moreno highlighted in the chart the interactions that the asset’s spot value has shown with this level over the past two years. It appears that during two of these retests (marked with green circles), the coin found support at this level and rebounded higher to continue the bullish momentum.
However, in the other three cases (red circles), Bitcoin failed to retest the level and noticed a decline. These corrections ranged from 8% to 12%, and the trend was last seen at the end of April/beginning of May.
With the possibility of another retest of the cryptocurrency, it will be interesting to see which model is followed this time. The analyst notes that if this level occurs, “the price could fall to about $60,000.”
Bitcoin price
At the time of writing, Bitcoin is trading at around $65,400, down over 6% in the past week.
