Analysts forecast Bitcoin consolidation in a $16,500–$21,100 range

The price of the first cryptocurrency remains in the range of $16,500–$21,100, reflecting a fragile balance of supply and demand. On-chain indicators signal that there is no shift in initiative from bears to bulls and a risk of a new wave of coin redistribution, according to Glassnode analysts.

#Bitcoin has rallied back above the key $20k psychological level after many months of low volatility.

In this edition, we analyze how Bitcoin may be hammering out a near-textbook bear market floor and what risks may lay on the road ahead.

Read it here 👇https://t.co/WrsifLhxHC

— glassnode (@glassnode) October 31, 2022

Experts stressed that the formation of a bottom in 2022 could continue if one looks at how long this process lasted in the past.

At present, the quotes for digital gold remain trapped between the realized price ($21,100) and balanced price ($16,500) over the last three months. In 2014–2015 and 2018–2019, this period lasted 10 and 5.5 months respectively.

The duration of hodlers’ capitulation period may also provide a useful signal for turning onto a growth trajectory. The last such period occurs when the average cost basis of coins purchased by this group falls below the price realized. In other words, long-term investors start to be “losing” to the “average” investor, according to the analysts.

Currently, that period lasts 3.5 months. In the two previous bear markets, it reached 8 and 17 months.

A similar signal can be assessed not only from unrealised profits and losses but also from the financial outcome of holders’ spending. The 90-day moving average of this ratio is 0.57. In other words, investors continue to predominantly realise losses.

New waves of capital inflows and profit-taking have not yet surpassed the scale of losses by sellers. The metric remains below 1 for the last 125 days, which is shorter than 375 and 263 days in the previous bear markets.

Recall, in October Glassnode considered bullish and bearish scenarios for Bitcoin.

Earlier trader Tone Vays forecast the price of the first cryptocurrency to $100,000 in 2023 on the backdrop of the approaching halving.

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