As a seasoned researcher with over two decades of experience in the financial markets, I find myself intrigued by this latest development in the Bitcoin market. The recent surge to $104,000 has certainly caught my attention, and the data from CryptoQuant provides an interesting insight into the behavior of long-term holders.
Initially, long-term Bitcoin investors decided to cash out when the price of Bitcoin reached an unprecedented peak of $104,000, according to information from CryptoQuant. In simpler terms, they sold some of their Bitcoins after it hit this record high.
Based on the data from our analytics source, it was noted that the rate at which long-term Bitcoin holders realized a profit, by comparing their purchase price to the selling price, showed an upward trend following the Bitcoin price surpassing the $100,000 mark.
On CryptoQuant’s chart, the Long-Term Holder SOPR reached 4, meaning that these long-term holders sold Bitcoin four times more than they originally paid for it. This implies that recent sellers likely bought Bitcoin when its price was around $20,000. Since then, Bitcoin has not been traded at this price since the market slump experienced in 2022.
Euphoria meets macroeconomics
Following its initial surpassing of $100,000, Bitcoin investors are now focusing their attention on U.S. economic data that could potentially either bolster or momentarily weaken the upward trend of Bitcoin’s price. The jobs report set for December 6 might influence the Federal Reserve’s monetary policies, although market analysts anticipate a reduction of 25 basis points scheduled for December 18.
A decrease in interest rates tends to make markets more active, potentially attracting investment towards cryptocurrencies like Bitcoin and others. Yet, as per Jag Kooner, the chief of derivatives at Bitfinex, an increase in interest rates might exert “pressure” that pushes Bitcoin’s value downward.
As an analyst, if a strong jobs report emerges, I might find myself reevaluating the Federal Reserve’s planned rate cut tempo, possibly favoring a slower, more deliberate strategy. This situation could fortify the U.S. dollar and exert pressure on risky assets like cryptocurrencies to decline. On the flip side, if the jobs report falls short of expectations, I may anticipate more aggressive rate cuts, which could increase liquidity and potentially boost the crypto market’s performance.
Jag Kooner, Bitfinex’s head of derivatives
Cautious Bitcoin optimism
Despite impending economic indicators, Arthur Azizov, CEO of B2BINPAY, stated that Bitcoin was overdue for a market adjustment, considering it had surpassed the $100,000 psychological level. Azizov added that a dip below $90,000 could be beneficial for Bitcoin, as it had experienced a 54% increase following Donald Trump’s re-election.
It seems quite plausible that a decline could occur soon; it’s simply a question of when. By the end of this year, I predict that Bitcoin’s price will stabilize around $100,000 before dropping to levels below six digits. This could bring the price down to approximately $85,000 in the ensuing months.
Arthur Azizov, B2BINPAY CEO
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2024-12-05 22:55