• Bitcoin’s rally from December lows after the FTX collapse surprised many investors, according to Glassnode’s weekly report.
• Bitcoin could potentially see further upside, but a fresh buy signal is likely at prices around $28.3k.
• Selling pressure above $23.3k is more likely given short-term holders and miner push for exit liquidity.
Bitcoin prices have been on the rise in recent weeks, pushing the leading cryptocurrency’s value above the psychological $20k level. After a breakout above this mark, Bitcoin is now hovering around $23,000, surprising many investors and raising optimism among bulls. However, as Glassnode has highlighted in its weekly report, this could be a precarious situation due to the potential for exit liquidity from profit booking, particularly from short-term holders and miners who suffered during the brutal bear market of 2022.
On-chain data platform Glassnode has noted that while the market rally has pushed Bitcoin prices above $23k, there is an increased motivation for network participants to take exit liquidity. This is due to the prolonged bear period of 2022, which saw a large number of holders and miners selling off their Bitcoin to avoid further losses. As such, Glassnode has warned that selling pressure above $23.3k is more likely, with a fresh buy signal likely to come at prices around $28.3k.
At the same time, Bitcoin could still see further upside, with Glassnode noting that the leading cryptocurrency is “almost out of the woods” and that several on-chain pricing models have been reclaimed. However, the firm has warned that this could be a short-term rally, as Bitcoin is not yet showing clear signs of a sustainable rise.
Overall, it appears that the current situation is a precarious one, with both bulls and bears looking to capitalize on the situation. With Bitcoin still below its all-time high of over $20k, now may be a good time for investors to assess the risks and rewards of entering the market. As always, caution should be exercised when investing in such volatile assets.