"Retail Investors Finally Revived"...Bitcoin, Short-Term Holders' Losses End

▲ Bitcoin (BTC) and Cash

Bitcoin (BTC) has once again surpassed the average purchase price of short-term holders. Following a sharp decline at the beginning of the year, the trend where recent buyers remained in a loss-making zone has changed, leading to an analysis that short-term investor sentiment, based on on-chain indicators, has entered a recovery phase.

According to NewsBTC on May 8 (local time), Bitcoin's spot price broke through the short-term holder realized price through its recent rally. The realized price is an on-chain indicator that tracks the average acquisition cost of investors within the Bitcoin network. If the price is above this indicator, it is interpreted to mean that all holders are in an unrealized profit state; conversely, if the price is below the indicator, it suggests greater loss pressure across the market.

The key to this analysis is not the realized price based on all investors, but the realized price of short-term holders. Short-term holders refer to the group of investors who have purchased Bitcoin within the last 155 days. As shorter holding periods tend to increase the likelihood of selling, this group is classified as a relatively sensitive investor segment in the market.

Bitcoin fell below the short-term holder realized price during the price drop at the beginning of the year. As a result, recent buyers were, on average, in a net loss position. For approximately three months thereafter, this indicator acted as a resistance level for Bitcoin's price. It is interpreted that whenever the price rebounded near the average purchase cost, short-term holders began to sell near their break-even point.

NewsBTC explained that while this indicator limited Bitcoin's rise during the rebound at the end of April, the trend changed in May. With the recent rally, Bitcoin moved above the short-term holder realized price, allowing this investor group to re-enter a profit zone. It was also noted that periods when Bitcoin traded above this indicator have generally coincided with bullish market phases.

However, breaking through the indicator does not immediately confirm a strong trend reversal. The short-term holder realized price is currently around $79,000, and NewsBTC diagnosed that Bitcoin has not yet sufficiently distanced itself from this level. Whether Bitcoin can stably maintain itself above this indicator has been presented as a key variable determining future short-term market trends.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*