Bitcoin HODLing has reached impressive heights, as Holders now expect higher prices.
It is necessary to assess the potential risks in the event of a major sell-off.
Bitcoin investors are eagerly waiting for Bitcoin to recover to the $70,000 price level, as evidenced by the huge unrealized profits â a sign that BTC holders have chosen to HODL, hoping for higher prices.
According to a recent CryptoQuant analysis, Bitcoin now has over $7 billion in unrealized profits. This observation highlights the level of HODLing that is taking place and the expectation of higher prices. However, it also highlights the potential for a major correction if or when profit-taking occurs.
If Bitcoin holders start taking profits off the table, selling pressure could lead to a similar outcome to what happened in late July, when prices fell sharply in just a few days. So far, optimism has helped BTC maintain its gains on the charts.
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Bitcoin is currently trading at $68,350, less than 2.4% away from $70,000. The cryptocurrency also appears to be approaching its next resistance level between $69,400 and $71,500.
Bitcoin Flow Drops to 2024 Low
Bitcoin Cryptocurrency Flows can give us interesting insight into the recent surge in the cryptocurrency's price.
The amount of money entering and leaving the floor increased simultaneously in mid-October from the 13th to the 16th. However, this money flow has cooled down and dropped to the lowest level this year.
Source: CryptoQuant
In fact, data shows that 3,760 BTC left exchanges in the past 24 hours. About 3,940 BTC moved into exchanges, which means that the inflows were slightly higher than the outflows.
These changes in flows suggest that BTC may be ready for a new surge. However, will the next surge be bullish or bearish? That remains to be seen, although address flows may provide some clues.
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The number of active addresses has been decreasing since mid-October. For example, they fell from 860,161 addresses on October 15 to 478,148 addresses on October 18.
Source: CryptoQuant
In contrast, the number of receiving addresses increased from 379,545 addresses on October 13 to 625,308 addresses on October 18. The data also shows that not only are there more Bitcoin buying addresses than selling addresses, but receiving addresses have grown while sending addresses have declined.
Address activity has confirmed a shift, suggesting a decrease in selling pressure despite recent price increases. While this result suggests Bitcoin could move higher, a sudden wave of selling may still be in the cards.
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