Bitcoin Short-Term Holders May Exert Selling Pressure
The Net Unrealized Profit Loss (NUPL) metric for short-term holders (STH) of Bitcoin is approaching zero, indicating that the average acquisition price of assets by this cohort is reaching parity with the current market price. This suggests that short-term holders may start exerting selling pressure on the market as they seek to capitalize on their investments.
According to CryptoQuant analyst, the rising Bitcoin price coupled with the increase in the STH NUPL metric could potentially trigger a wave of selling among short-term holders. This could have significant implications for the market.
Short-Term Holders Are Underwater
Short-term Bitcoin holders, who hold the asset for shorter periods of time, are currently underwater following recent price corrections. These investors are typically sensitive to abrupt price actions and their actions can impact market trends.
In an interesting shift in investor dynamics, short-term Bitcoin holders have reduced their holdings by nearly one million BTC since April, while long-term holders have added more than one million BTC during the same period. This has led to a significant decrease in the supply of short-term holders and an all-time high supply of long-term holders.
Hot Take: Potential Impact on Bitcoin Market
The approaching equilibrium of the STH NUPL metric and the potential selling pressure from short-term holders could have a significant impact on the Bitcoin market. As short-term holders look to capitalize on their investments, increased sell pressure could lead to further price corrections and hinder the asset’s ability to rally significantly in the near term.
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