Bitcoin (BTC) Recent Price Gain Is Approaching a Critical Juncture, Data Shows

Bitcoin's (BTC) recent price gain is approaching a critical juncture, according to data from leading on-chain analytics firm Glassnode.

Long-term holders (LTHs) of Bitcoin (BTC) usually become more inclined to sell their coins when their unrealized profit margins reach around 350%, according to on-chain analytics firm Glassnode.

This 350% profit marks a critical juncture as it leads to increased sell-side pressure, which, in turn, requires significant demand from buyers to sustain the upward price momentum.

At the time of writing, this 350% profit level corresponds to a BTC price of about $99,900. LTHs are investors who have held their Bitcoin over multiple market cycles, usually a period of 155 days.

This analysis is crucial for traders and retail investors who follow technical analysis indicators to understand the broader market dynamics and anticipate possible price volatility.

Bitcoin Faces Key Test at $99.9K as Long-Term Holders Eye Profit-Taking

The chart from Glassnode shows the behavior of long-term holders since December 2019. The green-shaded areas are periods of Bitcoin accumulation by long-term holders, while the red-shaded areas are periods of extreme sell pressure.

Historically, when the unrealized profit margin reached 350%, it would always correspond to periods of consolidation or pullbacks as these LTHs looked to take profits. Glassnode suggests that the current market structure is similar to these past patterns.

This analysis explains how BTC’s price movements are affected by the actions of long-term participants when they choose to start taking profits. However, sustained demand could overcome the selling pressure at the $99,900 price mark, which, in turn, would prevent a price drop at that level.

Such sustained demand could come from spot ETF (exchange-traded fund) demands, large-scale institutional market-making firms, or other market participants with sufficient buying power to absorb the sell-side pressure.

This Glassnode chart also highlights why certain price levels often become psychological barriers, even during periods of strong market trends.

Some market analysts opine that if this cycle deviates from this traditional pattern, it could be a sign that Bitcoin is maturing as an asset class.

Since its inception in 2009, Bitcoin has undergone a remarkable transformation from an experimental digital currency to a valuable asset class that now entices both institutional and retail investors.