Sokipiriye Dokubo
On one hand, on-chain analysis suggests a bullish outlook, indicating decreased sell pressure from traders who have already secured profits. The short-term holder realized price aligning with the market price indicates that short-term traders are no longer inclined to sell immediately due to substantial profits. However, unrealized profits across the network dipped recently due to factors like slowdowns in Bitcoin ETF inflows and escalating conflicts in the Middle East, impacting risk-on markets.
Despite the market pullback, analytics from IntoTheBlock indicate that Bitcoin’s performance was within expectations, with over 97% of holders still in profit for an extended period. Vincent Maliepaard, the marketing director, emphasized that such profitability levels are rare and unsustainable in the long term. The pullback itself, although significant, pales in comparison to previous drawdowns experienced by Bitcoin before the 2017 cycle top.
Glassnode’s momentum metrics reveal a positive trend across all time frames, suggesting continued bull market momentum based on changes to the average active investor’s cost basis. However, there’s a noted cooldown in the faster 30-day indicator, indicating a necessary reset for healthy market conditions.
On the contrary, analysts from major banks like JPMorgan and Goldman Sachs caution against potential downsides post-halving. JPMorgan believes the halving’s impact has already been factored into the market, estimating that Bitcoin’s price should be closer to $45,000 based on volatility-adjusted price relative to gold. The bank also highlights the lack of venture funding in the crypto market and elevated Bitcoin futures open interest as concerning factors.
Similarly, Goldman Sachs acknowledges Bitcoin’s historical tendency to surge post-halving but warns of varying timing for such surges. The bank suggests caution against overreliance on past cycles, emphasizing the importance of considering prevailing macroeconomic conditions. Additionally, the halving event itself could trigger a “sell-the-news” reaction among investors, according to Goldman Sachs analysts.