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4 on-chain metrics suggest the Bitcoin price spike may not end at $ 16,000

November 7, 2020

After declining the $ 15,960 on November 6th Bitcoin (BTC) price has vigorously defended the support level of USD 15,000. Based on four data points in a chain, analysts take this into account The rally could go beyond $ 16,000.

Analysts have indicated that Bitcoin stocks on exchanges will be reduced, supply will remain unchanged, the number of “stronger hands” will increase and profits will not be realized Factors for the continuation of the rally.

According to Coinmarketcap, Bitcoin’s market cap is currently $ 286,937,402,262.

The number of BTC on exchanges has decreased

4 on-chain metrics suggest the Bitcoin price spike may not end at $ 16,000
4 on-chain metrics suggest the Bitcoin price spike may not end at $ 16,000

Recently, Delphi Digital, an independent cryptocurrency research and advisory firm, published a Report on the Bitcoin Market Outlook.

Paul Burlage, an analyst at Delphi, said that The on-chain metric is generally showing good momentum for Bitcoin price.

Since February 11, Bitcoin’s stock market reserves have fallen from 2.96 million to 2.41 million. Expressed in dollars A drop of 550,000 BTC is equivalent to $ 6.36 billion.

The decline in Bitcoin stocks on the exchanges is an optimistic move as it means fewer sellers deposit BTC on exchanges. Burlage said What:

“On February 11, 2020, the BTC on the stock exchanges reached its all-time high of approximately 2.96 million. At this point in time, the BTC on the exchanges is approximately 2.41 million US dollars. This current trend has shown a divergence between the availability and price of Bitcoin, suggesting a more sustained upward move in $ BTC. “

Bitcoin reserves on exchanges. Source: Delphi Digital

BTC supply highs with no movement

While fewer sellers have transferred their funds to exchanges, The supply of immovable BTC remains high.

On September 9, Burlage stated that the percentage of unmoved BTC supply had hit an all-time high of 63.5%. Since then it has decreased slightly to 62%, but given that the price has increased significantly, this is a positive measure. Said:

“We saw a slight decrease in the percentage of unmoved supply last week last year. After hitting an all-time high near 63.5% of unmoving supply on September 9th, we are currently close to 62.0%. “”

This shows that despite the recent rally, investors are increasing the “HODLing” of Bitcoin and are not making big profits yet.

Still no clear signs of a cap

The number of “weak hands” or speculative buyers have declined significantly in recent weekswhile the strongest hands have gained weight.

The exit of short-term buyers and the entry of long-term “HODLers” suggest that Bitcoin could see a longer rally.

This trend is consistent with and shows the resistance of Bitcoin above $ 15,000 The previously very strong resistance level is about to become a support zone. Burlage noted that:

“While local highs for ‘weak hands’ tend to be falling, we cannot confirm that the recent speculative rally has capped the base. However, the larger trend suggests that stronger hands are populating the short-term bands rather than speculators.”

Bitcoin’s unrealized gains suggest that the rally could continue

In July 2019, the price of Bitcoin hit a high of around $ 14,000. At the time, Glassnode’s technical director, Rafael Schultze-Kraft, was said What Bitcoin’s relative unrealized gain reached 0.64.

Bitcoin’s relative unrealized profit. Source: Glassnode

Although the price of Bitcoin is currently over $ 15,000, the relative unrealized gain is currently at 0.53. This shows that BTC has the potential to see a broader rally before a major pullback.

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