In recent weeks, following a series of corrections, bitcoin and the broader cryptocurrency market have seen a significant rise from the lowest prices of 2024.
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Momentum picked up noticeably on Friday after Jerome Powell, Chairman of the Board of Governors of the Federal Reserve System, announced a change in policy, hinting at a possible interest rate cut in September. This announcement has fueled optimism among investors, leading to increased activity in the market.
Additionally, valuable data from Glassnode reveals that long-term holders (LTH) are consistently earning $138 million in profits per day. But what does this mean for the market going forward?
Daily capital inflows into bitcoin are crucial for price stability
Long-term bitcoin holders (LTH) have been steadily locking in profits over the past few months, even amid market uncertainty and volatility. According to the Long-Term bitcoin Holders Net Realized Profit/Loss Chart According to Glassnode, LTH is currently selling bitcoin at a rate of approximately $138 million per day. This selling pressure serves as a crucial benchmark for the market, as it indicates how much new capital needs to flow into bitcoin on a daily basis to counteract the selling and stabilize the price.
If daily inflows into bitcoin fail to reach this $138 million benchmark, the price could face downward pressure due to ongoing LTH sales. This dynamic underscores the delicate balance between buyer demand and LTH profit-taking activities.
As the market continues to navigate through this phase, it will be particularly interesting to watch bitcoin’s price action in the coming weeks. Whether new investor inflows can match or exceed this selling pressure will be key in determining btc’s next major move.
btc Surges Past $64,900: What’s Next?
bitcoin is currently trading at $64,360, at the time of writing, after enduring weeks of aggressive selling pressure, fear and uncertainty that saw its price drop to $49,577 just 20 days ago.
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btc is now flirting with the $65,000 mark following two successful daily candles that closed above the crucial 200-day moving average, a key indicator that investors use to identify a bullish or bearish market structure.
This development suggests that bitcoin is regaining strength, but it needs to stay above this indicator and ideally test it as support to sustain the uptrend.
If btc can hold this level, breaking above $65,000 should be a straightforward task, with the next target likely around $67,000. However, if the price fails to stay above the 200-day moving average near $63,000, bitcoin could be at risk of retesting local demand levels around $60,000.
Featured image created with Dall-E, chart from Tradingview.com
