Bitcoin price uptrend above $100k sees supply shifts to short-term holders
Bitcoin surged to $106,300 before retracing lower
Bitcoin saw a dramatic peak this week, reaching a 6-day high of $106,300 before pulling back to close at $104,650 on Thursday.
The retracement continued into the Asian session on Friday, with prices dipping to $103,800, but a recovery in the European session brought it back to $104,600. This volatile pattern has set the stage for potential further gains, with Bitcoin on track for a third consecutive day of upward movement if the bullish trend holds.
A key insight from this week's market action comes from the behavior of Bitcoin's long-term holders (LTHs). Data indicates that LTHs have offloaded approximately 1.1 million BTC, suggesting that even these historically patient investors found the recent price recovery above $100,000 irresistible. This selling has coincided with a significant increase in profit-taking compared to loss-taking, a pattern observed in previous bull markets. Glassnode's analysis shows a stark contrast in the ratio of profit to loss locked in by these holders, highlighting a clear shift towards capitalizing on gains.
This shift has directly influenced the market structure, with the supply previously held by LTHs now moving into the hands of short-term holders (STHs). This cycle of selling by LTHs and buying by STHs is typical in bullish markets, where new demand absorbs the supply released by profit-taking.
Bitcoin RSI stays bullish and $103,500 EMA support remains critical
BTC price dynamics (January 2025). Source: TradingView.
From a technical standpoint, the Relative Strength Index (RSI) on both daily and 4-hour charts remains in bullish territory, indicating continued momentum. However, if the bullish trend weakens, the 50 EMA on the 4-hour chart at $103,500 could serve as a critical support level. Should this level break, the next significant support is at $102,700, which has historically acted as a floor for price movements.
This week's market activity, combined with holder behavior, paints a picture of a market at a potential inflection point. The coming sessions will be crucial in determining whether the recent recovery in the European session is a sign of continued upward movement or merely a temporary rebound.
Strong buying interest during the Asian session led Bitcoin to gain 2%, reaching a four-day high. This price surge followed supportive on-chain data and key indicators, reinforcing the bullish momentum.
