Imminent Major Moves for Bitcoin Based on Key Price Metric

Bitcoin has enjoyed its first breakout in almost a month, pushing past the US $62k (AU $91k) ceiling after the US Feds cut interest rates by 50 bps. The weekly 8% gains have re-sparked positive sentiment across the market, with CoinMarketCap’s Fear & Greed Index moving back into the “Neutral” range. 

According to analysts CryptoQuant, the short-term rally may be an omen of good things to come, based on a couple of important metrics.

Related: Bitcoin A “Unique Diversifier” According to Nine-Page BlackRock White Paper

Bitcoin Poised to Break 3-Month Average Buy Price from Short-Term Holders

In a recent post from CryptoQuant, the analysts state that the “average buy price of Bitcoin holders who have held for 1-3 months has consistently acted as a critical support and resistance level.”

These short-term holders have significant sway in the market, as they are typically looking for arbitrage or profit opportunities based on Bitcoin’s monthly price movements.

So when Bitcoin’s price moves above the average buy price of active traders, CryptoQuant argues this can signal an impending breakout.

The flipside is also true – if Bitcoin fails to break through the average buy price, it can result in hefty losses.

Institutions Moving Away from Negative Bitcoin Derivatives, Short Orders Fall in Volume by 75%

Assessing CryptoQuant’s graph, we can see that the average buy price of Bitcoin over the past few months by short-term holders sits around the US $62-63k range. 

This price point is exactly where Bitcoin lies at the time of writing this article, after facing some resistance at US $63k (AU $92.5k).

Simply put, if Bitcoin can eventually burst through this ceiling, the market could be on the cusp of a bullish run to the end of 2024. On the flipside, a failure might signal a drawback as we move into 2025. 

Data is pointing to sell orders for Bitcoin melting away across institutions, yet another bullish signal pointing toward a medium-term rally.