Bitcoin’s short-term holder supply has historically increased in the past bull markets and it has acted as an important trend reinforcer. This pattern has repeated in the current market cycle and we may have not hit the top yet. Throughout the market cycle, several times influencers on Crypto Twitter have taken reference from the S2F or S2Fx model of Plan B. However, the current price action is not in line to hit $100000 by the end of April 2021, at least not based on the price chart.
The price chart and on-chain analysis were neutral for the most part of the last two weeks. Despite several dips, the price has recovered, but the recovery was largely rangebound in the previous instances of the current market cycle. Data from OKEx’s futures trading shows that retail investors are cautious post the last dip and they are not highly leveraged despite BTC testing ATH.
What’s more, based on Stephan Livera’s latest podcast, out of the 18.6 Million Bitcoin that is mined, 80% are held by illiquid HODLers/entities leaving only 4.2 Million in circulation. That number is only shrinking based on OKEx’s data. When the asset is still trading at a price over $59k, it is not at its peak. To push the price higher to the peak of the current price rally active supply is dropping and HODLers who hold for a long duration before selling have accumulated more Bitcoin in the recent dip.
To examine if this is the peak of Bitcoin’s price rally, more institutions and retail traders have turned towards the GBTC price premium. The GBTC price premium turned negative since the last price correction, and it hasn’t turned positive since then. Based on these metrics and the current price action, we are away from the peak of the price rally. These metrics suggest that the peak may not be the same as the S2F or S2Fx model in the current market cycle, however, post a correction in the price above the $59000 level. Metrics like inflow to exchanges and active supply have signaled a recovery and a price discovery beyond $59000, right up to the $67000 level.