On-chain data shows the Bitcoin short-term holders have responded to the latest price rally by participating in profit realization.
Bitcoin Short-Term Holders Have Shown A Realized Profit SpikeThe metric works by going through the transfer history of each coin being moved on the network to see what price it was transacted at prior to this. If the previous selling price was less than the latest spot price for any token, then that particular coin’s current transaction is leading to the realization of some net gain.
The exact degree of profit involved in the move is naturally equal to the difference between the two prices. The Realized Profit adds up this difference for all profitable moves on the blockchain.
The STHs are generally considered to represent the fickle-minded side of the market, with its members tending to show some reaction whenever market volatility emerges. During the last few days, Bitcoin has seen a recovery surge beyond the $74,000 level and it would appear that the STHs have reacted to it as well.
As displayed in the above graph, the 12-hour moving average (MA) of the Bitcoin STH Realized Profit spiked to a value of $18.4 million per hour alongside the price rally. Since the profit-taking spree has arrived, the cryptocurrency’s surge has stalled. “Consistent with the pattern observed over February, where short-term holders continue to exhaust each rally at the +$70k level, absorbing momentum before any breakout can develop,” explained Glassnode.
It now remains to be seen whether Bitcoin can overcome the profit realization pressure from the STHs this time around or if the rally’s fate will be similar to other recent attempts at recovery.
The uplift in sentiment suggests that the price rally has renewed some degree of optimism among traders, although with the index still at a value of 28, the market mood remains quite bearish.
BTC PriceBitcoin broke above $75,000 during the price surge, but it has since returned to $74,300.
