Glassnode: The $30,000 test undermined Bitcoin bulls’ confidence

The transition to ‘profit’ positions among Bitcoin speculators has made the picture of coin accumulation and distribution less straightforward. This has prevented the price from sustaining above $30,000, Glassnode noted.

With the strong opening to 2023, the aggregate market has confidently transitioned out of a regime of unrealized loss, towards one of unrealized profit.

In the latest edition of the Week On-Chain, we focus on the supply foundation formed over recent months and evaluate… pic.twitter.com/xUmBvXN1li

— glassnode (@glassnode) April 24, 2023

During the rally from the November 2022 low, the maximum correction did not exceed 18.6%. In retrospect, it lags behind previous bull cycles.

The rally of 2023 led to the number of profitable coins exceeding the number of unprofitable ones. The volume of the former since November 2022 rose by 4.87 million BTC, or 25.5% of the total supply.

In relative terms, this is comparable with previous cycles, underscoring a ‘solid foundation,’ the analysts noted.

Bitcoin did not reach the ‘fair’ price—the ratio of realized value to Liveliness (the dynamism of hodlers’ behavior) at $33,000, entering a ‘transitional regime’. This created the prerequisites for an increased likelihood of profit-taking from coins bought at lower levels.

The behavior of various investor categories in recent weeks has been mixed. The exception is the whales (on wallets over 10,000 BTC), which continued accumulating coins. This aligns with price consolidation in the form of a brief break above $30,000 and a subsequent retreat to $27,000.

A similar situation is seen in the metric aSOPR, which tests the 1 threshold from above downward, pushing the market toward a ‘decision point’.

A prolonged period below the threshold will indicate possible panic with increased selling. At present, the indicator for short-term investors hovers near 1. For hodlers, it has moved into a ‘profit-taking zone’, indicating a transition from bear to bull market, the analysts noted.

In value terms, profit-taking at the peak reached $518 million. Overall, the metric remains well below the highs of the 2021 cycle. Analysts noted greater resemblance to the 2019 bull market.

Analysts at Standard Chartered predicted Bitcoin would rise to $100,000 by the end of 2024.

In March, a similar scenario, but over 12 months,outlined by Messari CEO Ryan Selkis. Major players polled by CNBC made similar forecasts.