Bitcoin’s bull cycle is not over yet, as price valuation metrics are still far off compared to past bull market peaks.
Even as Bitcoin entered a period of price correction after rising to all-time highs, miners, whales and other investors, including large investors, began selling their Bitcoin holdings for profits. Additionally, CryptoQuant found that unrealized profit margins surged to 69%, reaching their highest level since March 2021. Although traders are selling off assets, unrealized profit margins remain as high as 47%.
Bitcoin’s pre-halving correction isn’t over yet, but investors are buying the lows. According to crypto analyst Rekt in a March 22 article, Bitcoin remains firmly in the historical pre-halving retracement zone (orange), so over the next 26 days or so until the halving, it remains Anything can happen.
In the long term, the Bitcoin bull market is not over yet because the highs of this bull market have not yet been reached. Demand for Bitcoin in the United States has weakened slightly, which can be observed in the negative premium on Coinbase. Analysts noted that if the correction continues, Bitcoin could fall to $58,000 to $60,000, the cost basis for large short-term holders. Currently, about 48% of Bitcoin investment comes from short-term holders, and bull market cycles typically end when this ratio reaches 84%-92%.
Despite the massive sell-off in spot Bitcoin ETFs, some investors are buying at the lows. ETF investors behaved like newbies, with ETF outflows reaching $1.6 billion at the first low, while the Bitcoin network saw net inflows of $1.1 billion. This suggests that many self-managed investors are adding to their positions at the lows. Bitcoin is entering a stage where long-term holders have greater influence over BTC supply dynamics, and traders are advised to pay close attention to the long-term holder market inflation rate to accurately predict market trends.
