• Bitcoin (BTC) began the year with a 23.3% rally, resulting in many BTC holders seeing their net holdings and operations return to profitability.
• On-chain data provider Glassnode used the 200-day Simple Moving Average (200D-SMA) to confirm whether the sentiment in the market in the last week was bullish or bearish.
• Glassnode found that BTC’s price surpassed the psychological level of $19,500 and its Realized Value, indicating that the average BTC holder experienced a net unrealized profit in the last week.
The last week of the year saw an incredible rally in the price of Bitcoin (BTC), resulting in many BTC holders netting unrealized profits as the cryptocurrency’s value surged past a psychological value of $19,500. In an effort to gain insight into the sentiment in the market during this period, leading on-chain data provider Glassnode assessed a few on-chain metrics to determine the underlying factors behind the surge.
Glassnode considered BTC’s 200-day Simple Moving Average (200D-SMA), which is often used as a benchmark for identifying macroeconomic trends across all types of crypto assets. By comparing BTC’s price to its 200-day SMA, investors and traders alike can determine whether the market is in a bullish or bearish trend. The analysis found that BTC’s price surpassed the psychological level of $19,500 and its Realized Value, indicating that the average BTC holder experienced a net unrealized profit in the last week.
In addition, the current bear market has lasted for 179 days below the 200D-SMA, only slightly less than the 386 days of the bear market in 2018-2019. This could suggest that should BTC’s price break above the 200D SMA, one might expect the price to rally as it did in 2019 and 2021.
The surge in the price of Bitcoin is not only a positive sign for current holders of the cryptocurrency, but it could also indicate a potential bullish trend in the market. With the 200D-SMA being a reliable benchmark for determining macroeconomic trends, it is likely that the rally in BTC’s price is just the beginning of a larger bull run in the cryptocurrency market.