After experiencing sell pressure that brought down the price below $100,000, Bitcoin may be getting set to experience another upward move.
According to data shared on 22 January by on-chain analytics platform Glassnode, sell side pressure has subsided, which means Bitcoin holders are becoming positive again.
Returning to accumulation
One of the major signs of positive sentiments in the crypto space is that investors are starting to accumulate assets.
For Bitcoin, the indicator that shows accumulation or sell-off is the Long-Term Holders (LTH). Currently, the indicator shows that long-term holders are starting to accumulate Bitcoin again after the sell off.
According to Glassnode, LTH supply is trending upwards now, a trend that was observed after the intra-cycle local top in March last year.
Similarly, Bitcoin exchange inflows have dropped by over 54% and even more for long-term holders, which has dropped by over 80%.
This shows that speculative activity around the asset has dropped significantly, and strong hands are piling up.
What this means
When investors, especially long-term holders accumulate more Bitcoin, it is a positive sign that shows that they are becoming positive again.
The positive sentiment may have to do with the crypto frenzy surrounding the Trump inauguration which has raised the expectations of crypto investors and enthusiasts.
This could serve as a precursor for another upward price movement for Bitcoin. Although Bitcoin has recovered reasonably and now trades at over $104,000, this accumulation phase could be the fuel to take Bitcoin back to its new all-time high or even higher.
If this happens, the general crypto market which has been moving sideways for a while as a way of shaking out weak hands may also see a bounce.
The Glassnode data may not be relevant to Bitcoin alone but the entire market, meaning weak hands are out and diamonds hands are ready for a long-term ride.
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