Bitcoin’s most recent rally has sent its price over the $90k mark, a fact that’s added to the speculation and thrill coursing through the crypto space. After two years of bearish tightening—crypto’s winter—the rally has investors excitedly anticipating a potential retest of that record $109,000 all-time high set back in January. Analysts believe that the road to and then past that milestone could be bumpy along the way.
Now, as Bitcoin moves closer to the $100,000 mark, many market analysts expect massive sell-side pressure. This expectation is not unfounded, as historical on-chain yelling has shown us that profit-taking in the forms of long-term holders (LTHs). This sell-side pressure will require especially strong demand to keep prices from sinking.
"Historically, LTHs begin distributing more aggressively around a 350% unrealized profit margin, which aligns with a $BTC price of ~$99.9k. As the market nears this level, increased sell-side pressure is likely, requiring strong demand to absorb it," - Glassnode
According to Glassnode’s analytical insights, LTHs tend to act when their unrealized profit margins reach at least 350%. After that, they begin releasing their assets more forcefully. For Bitcoin, this profit level translates into a price of just about $99,900. This might trigger more selling pressure once the cryptocurrency approaches this level of resistance.
"A clean breakout could open the path to price discovery above $100k." - Glassnode
So another large cluster of the Bitcoin coins were purchased when the price was around $95K-$98K. Wallets that purchased coins earlier this year, when Bitcoin was trading between $95,000 and $98,000, would benefit from taking profits now. They might only be interested in cashing out at breakeven or some small profit. This would only add to what we expect will be considerable sell side pressure in the $100,000 range.
Analysts point out that a breach of the $100,000 barrier would bring more price discovery. They point to the flip side as well—greater selling pressure. Should Bitcoin get past this anticipated resistance, this could be a breakout into unknown territory and possibly new all-time highs.
