Is The Bitcoin Bull Market Still On? STH Cost Basis Suggests So
Bitcoin prices have been somewhat quiet since then record high At $108,135, it’s difficult to maintain a six-figure valuation long-term. Case in point – the major cryptocurrency only lasted above $100,000 for a day before falling below $92,000 over the past week.
This weak price action has sparked discussions about whether the Bitcoin bull run may have peaked and ended. However, the latest on-chain observations suggest that the flagship cryptocurrency may still have room to rise further.
What is the current cost basis for short-term holders of Bitcoin?
Blockchain analytics company Glassnode in latest post on X Platform disclose The Bitcoin bull run may not be over yet. This on-chain observation is based on the movement of BTC price relative to the short-term holder (STH) cost basis.
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The STH cost basis metric tracks the average price at which short-term holders (investors who have held Bitcoin for less than 155 days) purchased their tokens. It represents the psychological level of Bitcoin investors and can be used as a technical point for analyzing prices, especially during bull market cycles.
Typically, the price of Bitcoin floats on the cost of STH bull marketindicating huge buying interest and positive sentiment among short-term traders. Conversely, when Bitcoin prices fall below this level (as is often the case in bear markets), it means new investors are left in the red, leading to massive selling pressure.
According to data from Glassnode, Bitcoin’s price is approximately 7% higher than the STH cost basis and is currently around $88,135. While the major cryptocurrency is a bit closer to cost base, that suggests short-term holders are unlikely to sell off the asset.
If the price of Bitcoin can maintain above the cost of STH, it means that the current bull market may continue. On the other hand, a break below $88,000 could set the stage for a trend reversal, with the market switching from bullish to bearish.
As of this writing, bitcoin price The price is just above $94,000, up just 1% in the past 24 hours. According to data from CoinGecko, the flagship cryptocurrency is down more than 3% in the past seven days.
Is a market rebound coming?
The cryptocurrency market has had a very poor performance over the past week, with some large-cap assets falling by double digits. Not surprisingly, many cryptocurrency traders have expressed interest in selling their assets on various social media platforms.
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However, this shift in investor sentiment increases the likelihood of a market recovery, as prices tend to move in the opposite direction to the crowd. On-chain intelligence company Santiment noted in a report Post on X This is the case with the fourth quarter 2024 rally, as increased bearish sentiment leads to higher prices.
Featured image from iStock, chart from TradingView
