Bitcoin’s price movement to above the $30k level has brought quite some positive developments in the market.
According to Glassnode, this has also sent an additional 1.8m (+66.4%) short-term holder (STH) coins into profit.
Short-term holders refer to those investors who have been holding onto their coins since less than 155 days ago. The percentage of STH supply in profit now stands at a whopping 96.9% (2.6M BTC).
In simple words, 96.9% of the entire supply held by the STHs is now carrying some amount of unrealised profit.
In the past, periods of unilateral STH profitability have usually been followed by tops for the cryptocurrency where its price action saw extreme elation.
As Bitcoin retested its most significant resistance mark in months, many traders might feel confident in holding onto the coin. However, it has also been noted that when more investors enter into profits, the more likely they become to be swayed into realising those gains. This then increases the risk of mass selling as there are a lot of holders carrying profits.
As a large number of STHs get tempted to participate in profit-taking, the price of the cryptocurrency might potentially register a drawdown.
Only time can tell whether the market can handle the profit-taking that would occur at these current price levels.
At the time of press, the top coin was trading at $30,449, rising by over 14% over the past week.
While there seemed to be a slight decline in its daily timeframe, the overall trend of the coin continued to remain bullish.