Bitcoin (BTC) Could Be Set for a Significant Price Decrease, Glassnode’s On-Chain Data Signals

If the signals AMBCrypto got from Glassnode’s on-chain data are anything to go by, Bitcoin [BTC] could be set for a significant price decrease.

Bitcoin [BTC] might be gearing up for a significant price decrease if the signals picked up by AMBCrypto from Glassnode’s on-chain data are anything to go by.

This prediction is being led by the LTH Market Inflation Rate. LTH stands for the Long Term Holders in the market.

The LTH Market Inflation Rate uses the level of accumulation or distribution to determine Bitcoin’s next direction.

Now, if you look at the chart below, you will notice two lines on this chart. The green color represents the market inflation rate, while the manila color indicates the nominal inflation rate.

Investor belief does not equate their actions

During bull cycles, if the market inflation drops below the nominal inflation, it indicates that long-term holders are accumulating. As such, this could drive a price increase for Bitcoin.

On the other hand, the market inflation rate rising above the nominal rate suggests that holders are significantly adding to the sell pressure.

Hence, BTC could be on the verge of a notable fall. At press time, the metric formed the latter pattern.

Bitcoin changed hands at $69,164 at press time, representing a 2.98% increase in the last seven days.

But before we conclude that holders might push BTC to the downside, let’s see what AMBCrypto has to say about the sentiment that holders have about the coin.

To do this, we analyzed the LTH-NUPL. This metric is an acronym for Long Term Holder – Net Unrealized Profit/Loss. With this, one can have an idea of the behavior of long-term holders.

As of this writing, the LTH-NUPL was in the belief zone (green). This indicates that holders, who have held the coin for at least 155 days, are confident in Bitcoin’s potential.

However, this might not be for the short term, as the same set of people might contribute to BTC’s distribution.

In terms of price prediction, the liquidation heatmap provided some interesting insights into the coin’s movement.

$72K, then $63K

The liquidation heatmap helps traders to find the best liquidity positions. If liquidity is concentrated in an area, prices can move in that direction. However, high liquidity zones can also be resistance or support zones.

Using data from Hyblock, AMBCrypto managed to identify a magnetic zone at $72,350, indicating that Bitcoin’s price could move toward that region.

However, the same zone could act as resistance for the coin. If BTC rises to the aforementioned price and gets rejected, it could spell doom for the cryptocurrency.

This is because the other major high-liquidity area was at $63,050.

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Going by the indications above, Bitcoin’s price can increase. But when the correction appears, it could be difficult for the coin to rebound.

Should the coin lose hold of $63,050, the next decline could send BTC to $56,200. However, if this does not happen, Bitcoin might bounce toward $70,000 one more time.