Bitcoin’s recent price movement has been influenced by short-term investors holding the cryptocurrency for less than six months.
This group, controlling over half of the realized market cap, has played a pivotal role in Bitcoin’s price surge above $67,500. The 7% weekly recovery has brought Bitcoin to levels not seen in nearly a month, sparking discussions about potential new all-time highs.
At press time, BTC was trading at $67,680, showing a 2% price increase in the past 24 hours, according to CoinMarketCap data.
BTC/USD 1-day price chart (Source: CoinMarketCap)
CryptoQuant’s analysis reveals that the $61.5K level could serve as crucial support due to its reflection of the Short-Term Holder (STH) Realized Price. This metric indicates the realized capital of investors who have held their Bitcoin for up to six months. With short-term investors making up 53.48% of the total market cap, their sensitivity to price changes around this level could make $61.5K a support area. If this support is breached, it might transform into a strong resistance point.
$61.5K: A Critical Support Level
The $61.5K level is highlighted as a key area of interest due to the behavior of short-term Bitcoin holders. According to CryptoQuant, the 0-day to 1-week STH group, which closely tracks the spot price, comprises 10.6% of the market cap and typically shows minimal variance. However, the 1-week to 6-month cohort, accounting for 47.78% of the market cap, offers a more accurate reflection of short-term trader actions and sentiment.
Notably, those who entered during March’s rally now command more than 30% of the realized cap. This shift from long-term to short-term holders suggests that $61.5K could act as a pivotal level. Should this support be decisively broken, it could become a significant resistance point, complicating Bitcoin’s price trajectory.
Potential for New All-Time Highs
Bitcoin’s price improvement has led to optimism about the possibility of reaching new all-time highs. Currently trading just below $67,500, the cryptocurrency has surpassed early May highs of $64,000. According to 10X Research’s latest newsletter, breaking above this resistance could pave the way for new peaks.
The report also emphasizes the $68,300 level as a critical “line-in-the-sand.” Surpassing this threshold could trigger a strong rally. While Bitcoin trades bullishly, challenges in market structure and fundamentals remain.
However, the subdued selling pressure and a supportive macroeconomic environment, including stable inflation and no imminent interest rate hikes from the Federal Reserve, create a favorable setting for Bitcoin’s continued ascent.
Bullish Market Sentiment
The bullish sentiment is further supported by increased demand for Bitcoin Spot ETFs. Matteo Greco, a research analyst at Fineqia, notes a significant uptick in BTC Spot ETF inflows, reversing five weeks of low demand. Last week saw about $950 million in net inflows, a demand level not observed since March.
Crypto analyst Jelle also echoes this optimism, noting that Bitcoin has broken its local downtrend and reclaimed previous cycle highs, consolidating around $67,000. The consolidation phase suggests a potential for further upward movement, with expectations of pushing into higher price ranges.
#Bitcoin broke the local downtrend, reclaimed the previous cycle highs – and now consolidates around $67,000.It's time to push back into the seventies, and beyond. pic.twitter.com/KMrtQsx9lW
— Jelle (@CryptoJelleNL) May 20, 2024
Santiment data provides additional bullish signals, indicating that wallets holding less than 0.1 BTC have reduced their total holdings by 0.46% over the past week. Historically, this transfer of Bitcoin from smaller to larger wallets has been a positive indicator for future price movements.
The post Bitcoin Climbs Past $67,500 Market Eyes New Highs with Bullish Sentiment appeared first on Coinfomania.
