Following the recent bullish momentum seen early in the year, the Bitcoin price has displayed a bit of correctional movement and now stands closer to $90,000 than it did a week ago. While BTC’s most recent retracement raises suspicions of resistance lying at the $94,000 price, the latest on-chain evaluation hypothesizes the presence of a more relevant resistance just beneath $100,000.
New Whales’ Cost Basis Sits Around $99k
On-chain analyst Axel Adler Jr recently took to the social media platform X to share an interesting hypothesis on the Bitcoin price trajectory. His on-chain observation was based on the Realized Price New Whale STH Vs Old Whale LTH indicator.
For context, this metric compares the acquisition cost, on average, of recently accumulated whale holdings (short-term holders) with that of Bitcoin’s long-term whale holdings.
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Axel Adler Jr shared in his post that new whales have an average entry price near the $99,000 level. Currently, Bitcoin holds a valuation near $90,000, meaning its new whales are holding through unrealized losses.
Hence, if the premier cryptocurrency ascends towards these whales’ average acquisition price of $99,000, the crypto pundit explained that these investors might become incentivized to sell their holdings. This means that these large BTC holders exit the market at break-even prices, or while incurring minimal losses.
When the largest Bitcoin investors sell their holdings, the effect often translates to price through reduced buying momentum and a simultaneous increase in downside pressure. As a result, the entry price of these investors — in this case, $99,000 — becomes major resistance, both psychologically and technically.
Long-Term Whales’ Average Cost At $39K
In a separate post on the CryptoQuant platform, on-chain analyst Arab Chain revealed the average cost basis across varying cohorts of Bitcoin’s investors. As the new whales hold through their unrealized losses, the Binance user deposit addresses metric tells a fascinating story.
According to the analyst, the average holding cost on Binance is approximately $52,691, indicating that a good portion of Bitcoin’s traders are doing so while enjoying their profit.
Interestingly, the Miner Whales are not left out of this comfort zone. This group of holders, who have more than 1,000 BTC stowed away, has an average holding cost of $58,681. Considering that price is well above their cost basis, it suggests that Bitcoin miners are also in deep profit. As a result, there will be expectedly minimal selling pressure from this faction of the market.
For Bitcoin’s Long-term Holder whales, the story is more rosy. These investors are holding their coins with an average acquisition cost of $39,681. As is intuitively obvious, this group of BTC holders is also operating within clear bounds of profit.
Ultimately, it is clear that Bitcoin has a structurally bullish outlook, with unshaking investor support. If downside momentum were to enter the market, it would likely be short-term, as its oldest traders appear to be under no pressure to shave off their holdings. If retracements sponsored by these investors occur, it would likely be as a result of light profit-taking, rather than capitulation events.
As of this writing, the price of Bitcoin stands at around $90,624, with no significant movement since the past day.
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Featured image from iStock, chart from TradingView
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