Long-term Bitcoin (BTC) holders have started taking profits since the cryptocurrency’s price attempted to reach USD 100,000. As a result, the price of Bitcoin fell to USD 93,000, impacting the value of the broader crypto market cap.
Is the price of Bitcoin rebounding? Short-term investors may want to know as this on-chain analysis examines the possibilities.
Activity around Bitcoin declines, holders post gains
According to CryptoQuant, Bitcoin’s long-term profit ratio has risen to 2.86. This ratio measures the activity of long-term investors who have held the coin for more than 155 days.
When the ratio is greater than 1, it means that these Bitcoin holders are selling profitably. On the other hand, if the profit ratio is less than 1, it implies that holders are selling at a loss. Since the reading is higher, it indicates that these holders are booking profits from the recent rise in price.
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Furthermore, it is important to mention that this profit taking is the highest that holders have taken since August 30th. If this continues, BTC price risks falling below the USD 93,000 mark.
Profit Spent Ratio by Long-Term Bitcoin Holders. Source: CryptoQuant
On top of that, active addresses on the Bitcoin network have dropped significantly this week, which could spell trouble for the cryptocurrency’s price if the trend persists. Active addresses measure the number of unique addresses involved in transactions, reflecting users’ engagement with the blockchain.
When active addresses increase, it indicates growing network activity and adoption. Conversely, a decline suggests reduced participation.
On November 26, active Bitcoin addresses were nearly 1 million, showing considerable interest. However, at the time of writing, the figure has fallen to 768,000, a noticeable decline. If active address activity continues to decline, it could signal weakening market sentiment and contribute to further price declines, as highlighted above.
Active Bitcoin Addresses. Source: Saintly
BTC Price Prediction: Is It Time to Drop Below 90 000 USD?
In the daily chart, the price of Bitcoin dropped under the dotted lines of the Parabolic Stop and Reverse (SAR) indicator. This technical tool identifies support and resistance levels.
The dotted lines below the price signal strong support, while the lines above the price suggest resistance that could lead to a decline. Currently, Bitcoin faces the latter scenario.
Bitcoin Daily Analysis. Source: TradingView
If this resistance persists, BTC could fall to USD 84,640. However, if long-term holders will reduce profit takingthe value of Bitcoin could instead increase, potentially reaching USD 99,811.
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