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Investors with a longer time horizon are looking to increase their bitcoin holdings amid calls for deeper price cuts.
Glassnode data shows bitcoin’s “net hodler position change”, which tracks the net buy / sell activity of those who hold coins for six months or more, turned positive for the first time since late October . Hodl is the crypto slang to hold on.
“This shows that the HODLers are buyers here,” Delphi Digital said in its daily market commentary dated June 16. “The net positions of BTC HODLers are a strong indicator of how long-term investors think about BTC.”
The supply held by long-term holders has grown from 11 million to over 11.6 million in recent weeks, according to Glassnode.
While holders are now injecting bullish pressure into the market, this does not necessarily imply a strong recovery. Past data shows that bullish trends accelerate mainly after sustained accumulation by holders.
For example, the indicator remained positive for most of 2018, which was a negative year for bitcoin, and into early 2019, when cryptocurrency remained below $ 5,000. The bullish mood returned to the market in the second quarter of this year, pushing the cryptocurrency to $ 13,880 at the end of June.
Bitcoin increased this peak in October 2020 after a 16-month gap. During this period, the cryptocurrency was mainly in a downtrend, dropping from $ 13,000 to $ 4,000 between August 2019 and March 2020. Holders were net buyers throughout and during the recovery that followed, and began distributing coins in November.
It remains to be seen whether they will continue to be net buyers in the coming weeks and restore shattered market confidence.
Some chart analysts are concerned, however, that the cryptocurrency may sell more in the near term, as the daily chart shows that the 50 and 200-day Simple Moving Averages (SMA) (SMA) are expected to produce a death cross (bearish cross) in the market. next day or both.
According to Kraken research, previous cases of deadly crosses on the daily chart have coincided with “either a massive sell-off in the days that followed or a continued macroeconomic downtrend that confirmed a bear market.”
Macro funds, which have bought bitcoin as a store of value, may sell if US Treasury yields rise further. The two-year U.S. yield hit a 12-month high of 0.219% and the 10-year yield rose almost 10 basis points to 1.59% on Wednesday after the Federal Reserve signaled a rate hike on interest sooner than some had expected.
Bitcoin is currently trading at $ 39,450, up 2% on the day.
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