Bitcoin Breaks $31,000 Mark in Latest Rally
Bitcoin has surged past the $31,000 mark in its latest rally, marking a significant milestone for the cryptocurrency. On-chain data suggests that this level could be an important turning point for BTC.
Bitcoin Realized Price Reveals Profit/Loss Situation of Buyers
Analyst James V. Straten has shared insights into the profit/loss situation of different yearly Bitcoin buyer cohorts. The focus is on the “realized price,” which tracks the average price at which investors bought their BTC.
If the asset’s spot price is lower than this metric, holders are currently at a loss. Conversely, if it surpasses the indicator, it indicates profitability among investors.
Realized Price Chart for Bitcoin Since 2017
Straten’s chart reveals the trend in Bitcoin realized prices for each year since 2017. It shows that during the peak in 2021, the cost basis for this group was around $48,000. However, the realized price has since decreased significantly due to impressive Dollar-Cost Averaging (DCA) in the market.
Past examples suggest that major cost basis levels have influenced BTC’s spot price, often acting as support or resistance upon retests. Therefore, reaching the $35,000 level would be a significant milestone for Bitcoin and may indicate a positive outlook for the cryptocurrency.
Potential Pullback as Profits Increase
While reaching new milestones may be promising, there is a possibility of participants harvesting their gains and causing a short-term pullback in price. As more buyer cohorts enter profitable territory, profit-taking becomes more likely.
BTC Price Update
As of now, Bitcoin is trading at around $31,200, representing an 11% increase over the past week.
Hot Take: Bitcoin’s Milestone Breakthrough
The recent surge in Bitcoin’s price has pushed it beyond the $31,000 mark, signifying a significant achievement for the cryptocurrency. The realized price analysis suggests that reaching $35,000 could pave the way for further positive developments. However, as profits increase and investors consider taking gains, there may be a temporary setback in price. Despite this possibility, the current trading price reflects an upward trend for Bitcoin, with an 11% increase over the past week.
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