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Cryptocurrency News Articles
Bitcoin (BTC) Price Rebounds to $63,000, Attempts to Reclaim Critical Short-Term Holder (STH) Cost Basis
Oct 09, 2024 at 08:16 pm
Following a significant 10% price correction, the Bitcoin market has rebounded to the $63,000 level, attempting to reclaim the critical Short-Term Holder (STH) cost basis.
Bitcoin price attempts to reclaim a critical cost basis after rebounding from a 10% price correction. The market recovered following one of the steepest one-day sell-offs since the 2022 cycle bottom, despite lower weekend trading volumes.
Bitcoin Price Recovers a Key Cost Basis
After a significant price correction, the Bitcoin market has rebounded to the $63,000 level. This recovery comes after one of the deepest one-day sell-offs since the 2022 cycle bottom, highlighting the market’s resilience despite lighter weekend trading volumes.
However, Bitcoin price has managed to rebound from the key support level at $60,000, attempting to reclaim the Short-Term Holder (STH) cost basis of $62,500. This cost basis serves as a critical support/resistance level, indicating the average price at which short-term traders acquired their BTC holdings.
As highlighted by Glassnode, the spot price has now crossed above the STH cost basis. This metric captures the cost basis for traders who have held their Bitcoin for less than 150 days on average.
A failure to maintain this level could put recent buyers under pressure, especially given the challenging conditions of the past few months.
Macro Outlook, Key Cost Basis Levels
On a broader scale, the True Cryptocurrency Market Mean ($47,000) and the Active Investor Price ($52,500) provide insights into the average cost basis for active investors. The spot price has remained above these levels for most of the year, suggesting a robust market with strong demand support during drawdowns.
The Unspent Transaction Output Realized Price Distribution (URPD) metric further indicates that small price fluctuations can significantly impact investor profitability, given the large cluster of coins at the current price level.
Futures Speculation, Market Volatility
Despite a reduction in long-biased speculation, the futures market shows signs of increasing speculative interest. The directional premium has recently exceeded its +1σ band, indicating a potential return of speculative activity.
A substantial $2.5 billion in futures open interest was closed during the recent rally, suggesting a flushing out of short sellers. However, the market remains susceptible to heightened volatility, which could lead to significant price swings due to deleveraging pressures and liquidations.
The Bitcoin market’s near-term future hinges on maintaining the STH cost basis. While Short-Term Holders have shown strength, the increasing speculation in futures markets points to potential volatility ahead.
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