Will Bitcoin Break Through $70k? Short-Term Holders’ Buy Price Holds The Key

Samuel Edyme

8 months ago

3 mins read

Will Bitcoin Break Through $70k? Short-Term Holders' Buy Price Holds the Key

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Recent CryptoQuant analysis suggests that short-term Bitcoin holders’ average buy price could be a key factor in predicting the leading crypto’s future movements.

The focus is on holders who have had Bitcoin for months, with historical data indicating that their average buy price often serves as a critical support or resistance level. These short-term holders’ buy prices have been linked to significant shifts in Bitcoin’s market direction.

How Short-Term Holders Buy Price Hints At Future Move

The analysis, provided by an analyst under the pseudonym ‘Avocado Onchain,’ draws attention to the historical instances where Bitcoin’s price either broke through or was rejected by the average buy price of these short-term holders.

The analyst points out that monitoring this average buy price could offer insights into Bitcoin’s potential future trends.

According to the data presented, the average buy price of Bitcoin holders who have held their assets for 1-3 months has repeatedly influenced the cryptocurrency’s price direction.

Bitcoin realized price metric. | Source: CryptoQuant

When Bitcoin’s price successfully breaks through this average buy price, it often leads to a notable bullish trend. Conversely, when the average buy price acts as a resistance point, it can signal the beginning of a bearish phase.

An example highlighted by Avocado was when Bitcoin reached $73,000 earlier this year and then saw subsequent declines. According to the analyst, at that time, Bitcoin failed to surpass the average buy price of these short-term holders, leading to a bearish trend afterward.

This pattern suggests that the average buy price of short-term holders can serve as a reliable on-chain metric for assessing market sentiment.

As Bitcoin’s price approaches these levels, it tends to face critical tests of momentum, which can either confirm or redirect the prevailing market trend.

Bitcoin Rally To $70k Approaching?

Bitcoin is now seeing a gradual push towards the upside following the announced US fed rate cut yesterday. In the past day alone, the asset has surged by 5.8% with a current trading price of $63,054.

Bitcoin (BTC) price chart on TradingView — BTC price is moving upwards on the 2-hour chart. Source: BTC/USDT on TradingView.com

Avocado noted:

With the recent announcement of a 50bp rate cut by the U.S. Federal Reserve, Bitcoin is once again attempting to break through the average buy price of 1-3 month holders.

Although it remains to be seen whether Bitcoin will eventually break through the short-term holder buy price level thereby resulting in further bullish momentum, analysts in the crypto space have shared their optimistic outlook on the crypto.

According to crypto analyst, Moustache, Bitcoin has, for the first time in history, seen a “golden cross of the SMA100/SMA200 (W)”.

Bitcoin price chart. | Source: Moustache on X

Moustache revealed that this technical pattern, coupled with the recent US interest rate cut might set the asset up for the most “legendary” price moves in the coming months.

#Bitcoin

-For the first time in $BTC‘s history, we see a golden cross of the SMA100/SMA200 (W).

and at the same time..

-Fed cuts interest rates for the first time in 4 years🤯

Prepare yourself for some legendary months. pic.twitter.com/mLtwszJ3rf

— 𝕄𝕠𝕦𝕤𝕥𝕒𝕔ⓗ𝕖 🧲 (@el_crypto_prof) September 19, 2024

Featured image created with DALL-E, Chart from TradingView

Samuel Edyme

Meet Samuel Edyme, Nickname - HIM-buktu. A web3 content writer, journalist, and aspiring trader, Edyme is as versatile as they come. With a knack for words and a nose for trends, he has penned pieces for numerous industry player, including AMBCrypto, Blockchain.News, and Blockchain Reporter, among others.

Edyme’s foray into the crypto universe is nothing short of cinematic. His journey began not with a triumphant investment, but with a scam. Yes, a Ponzi scheme that used crypto as payment roped him in. Rather than retreating, he emerged wiser and more determined, channeling his experience into over three years of insightful market analysis.

Before becoming the voice of reason in the crypto space, Edyme was the quintessential crypto degen. He aped into anything that promised a quick buck, anything ape-able, learning the ropes the hard way. These hands-on experience through major market events—like the Terra Luna crash, the wave of bankruptcies in crypto firms, the notorious FTX collapse, and even CZ’s arrest—has honed his keen sense of market dynamics.

When he isn’t crafting engaging crypto content, you’ll find Edyme backtesting charts, studying both forex and synthetic indices. His dedication to mastering the art of trading is as relentless as his pursuit of the next big story. Away from his screens, he can be found in the gym, airpods in, working out and listening to his favorite artist, NF. Or maybe he’s catching some Z’s or scrolling through Elon Musk’s very own X platform—(oops, another screen activity, my bad…)

Well, being an introvert, Edyme thrives in the digital realm, preferring online interaction over offline encounters—(don’t judge, that’s just how he is built). His determination is quite unwavering to be honest, and he embodies the philosophy of continuous improvement, or “kaizen,” striving to be 1% better every day. His mantras, “God knows best” and “Everything is still on track,” reflect his resilient outlook and how he lives his life.

In a nutshell, Samuel Edyme was born efficient, driven by ambition, and perhaps a touch fierce. He’s neither artistic nor unrealistic, and certainly not chauvinistic. Think of him as Bruce Willis in a train wreck—unflappable. Edyme is like trading in your car for a jet—bold. He’s the guy who’d ask his boss for a pay cut just to prove a point—(uhhh…). He is like watching your kid take his first steps. Imagine Bill Gates struggling with rent—okay, maybe that’s a stretch, but you get the idea, yeah. Unbelievable? Yes. Inconceivable? Perhaps.

Edyme sees himself as a fairly reasonable guy, albeit a bit stubborn. Normal to you is not to him. He is not the one to take the easy road, and why would he? That’s just not the way he roll. He has these favorite lyrics from NF’s “Clouds” that resonate deeply with him: “What you think's probably unfeasible, I've done already a hundredfold.”

PS—Edyme is HIM. HIM-buktu. Him-mulation. Him-Kardashian. Himon and Pumba. He even had his DNA tested, and guess what? He’s 100% Him-alayan. Screw it, he ate the opp.

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