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Bitcoin Under $26K: Is a Rally to $30K in Sight Amid Long-term Holder Dominance?

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  • Bitcoin currently trades below the vital $26,000 threshold, but market indicators suggest a potential rally towards $30,000.
  • Long-term holders control the majority of Bitcoin’s supply, indicating strong fundamental support, while short-term holders are in capitulation mode.

Analyzing Bitcoin’s Market Position Below $26K

As the week kicks off, Bitcoin has been trading below the pivotal $26,000 mark—a threshold considered crucial for gauging the market’s bullish or bearish sentiment. Last week’s gains that pushed the cryptocurrency above $27,000 were wiped out, despite Grayscale’s legal victory over the U.S. Securities and Exchange Commission (SEC). However, the market remains optimistic that the win for Grayscale could set a precedent for the eventual approval of Bitcoin spot exchange-traded funds (ETFs).

What Market Indicators Tell Us

While the current price hovers at $25,992, predictive indicators are painting a more optimistic picture. The Relative Strength Index (RSI), a key barometer of market momentum, is moving toward the mean line of 0.00. This shift generally indicates a bullish phase where buyers are likely to dominate. Should the price break above the $26,000 mark, it could trigger a wave of buying activity, potentially pushing the price targets to $28,000 and eventually $30,000. For the risk-averse trader, a conservative strategy would be to wait for the price to stabilize above $26,000 before entering the market.

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On the fundamental side, data from on-chain analytics firm Glassnode reveals that long-term holders now possess a dominant share of the Bitcoin supply, setting new records in terms of dormant Bitcoin—approximately 40.5% of the total supply. In contrast, short-term holders appear to be capitulating, or selling at a loss, which is often a precursor to a strong recovery.

Moreover, nearly 30% of Bitcoin supply has remained static in wallets for over five years. This level of inactivity is often interpreted as a strong sign of Bitcoin‘s growing acceptance as a long-term store of value rather than a mere speculative asset. The behavior aligns with market expectations of a robust bull cycle in 2024/2025.

James Straten, a data analyst, noted that there’s an ongoing divergence between long-term and short-term holder activity.

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“Around 20k BTC have been sent to exchanges at a loss by short-term holders,”

he stated, adding to the compelling narrative that long-term holding patterns are fundamentally solid, even though the price of Bitcoin is currently under $26,000.

While a descent below $25,000 and even further to $23,500 can’t be completely ruled out at this juncture, the confluence of these factors suggests that a Bitcoin rally towards $30,000 is not out of the realm of possibility.


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Collin Brown
Collin Brown
Collin is a Bitcoin investor of the early hour and a long-time trader in the crypto and forex market. He's fascinated by the complex possibilities of blockchain technology and tries to make matter accessible to everyone. His reports focus on developments about the technology for different cryptocurrencies.
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