Bitcoin (BTC) Short-Term Holders Surge as Breakout From Trading Range Consolidation Rekindles Market Volatility

Insights from the world's premier analytical platform CryptoQuant show that this movement has woken up previously idle networks and pointed to new trends that have to be observed.

Bitcoin price rose last week from recent consolidation.

What happened

Fresh insights from CryptoQuant show that Bitcoin’s breakout has awoken previously idle networks, presenting new trends to observe.

Sellers have become active

“Short-term holders transferred 33,155 bitcoins as shown by the 1w-1m spent output age bands. This could present immediate selling pressure.” – By @XBTManager

Bitcoin price rose last week from recent consolidation, presenting a notable deviation from the digital currency’s mostly sideways trading in the past several months. The breakout has also led to an expansion of the Bitcoin price range and the presence of high volatility, which is also synonymous with other cryptocurrencies during a breakout.

Bitcoin short-term holder surge

During this surge, one of the activities noted to be on the rise is that of the short-term holder. From CryptoQuant, the above holders spent 33,155 bitcoins in the one week to one month spent output age bands. This activity level is important because the near term always has the capability of displaying selling pressures which have the ability to determine the next move of the BTC prices.

The short-term holders are noted to be spending such a large volume of Bitcoin within a short time due to bearish sentiments or profit-taking after a sharp rise in the price of BTC. This selling pressure can slow the upward momentum as evident from current prices as demonstrated in the following chart. The slowdown earlier this year might be an indication that Bitcoin might be due for a normal correction; where prices dip to certain levels in search of new supports and resistances.

According to the analysis, market participants should be careful during this period. Should the movements within these age bands gain momentum the market may experience more significant swings. Higher activity in these segments is normally associated with intensified market fluctuation which makes it a significant factor to consider for any trader or investor.

Although the current Bitcoin price has spurred some hope among investors, analyzing the data presents a relatively convoluted market picture that must be addressed. However, the possibility of retracement together with the high selling pressures from the short-term holder class points to future instability of BTC’s short-term outlook than the initial rally indicates.

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