Bitcoin (BTC) Short-Term Holder Loss Remains Low Despite Market Volatility

Since then, the crypto asset has teased a position above $100,000 as the market contemplated the next directional bias.

Bitcoin (BTC) price dropped to a low of $98,000 on Jan. 24 before quickly recovering. The crypto asset has since teased a position above $100,000 as the market contemplates the next directional bias.

Bitcoin short-term holder loss remains low

There has been a noticeable conflict in market sentiment over the past couple of weeks, with some analysts calling it a market top while others remain optimistic for another leg up.

For the better part of the previous week, President Donald Trump’s tight-lipped demeanor on any crypto-related executive orders during the inauguration speech did not sit well with the Bitcoin community.

However, a glance at the on-chain metrics shows that short-term holders, or those that have held BTC for less than 90 days, have not participated in any large-scale selling activity.

In fact, the recent price drop occurred as short-term holders sold around 2,000 BTC at a loss.

Bitcoin short-term holder profit loss to exchanges. Source: X.com

On the previous seven occasions when BTC dropped by more than 5%, more than 5,000 BTC were moved at a loss on exchanges. The analyst said the recent shake-off did not indicate any “major panic selling in the market.”

Bitcoin Buy/Sell Pressure Delta by Joao Wedson. Source: X.com

In light of that, buying pressure has swiftly returned after the price dropped under $100,000. But a significant amount of long positions were compromised.

Glassnode, a data analytics platform, said more than $68 million longs were liquidated in 24 hours. The platform added,

“This is the highest volume of long liquidations since December 4th, and it coincides with the price dropping below $100,000 for the first time since January 15th. Overall, a large amount of buying pressure has returned to the market following the price wick.”

Will Bitcoin price see a swift reversal?

One particular trend observed with Bitcoin over the past few months is volatile Monday price action which can often determine the weekly low or high before reversing in the opposite direction.

This can usually occur when the price moves sharply in low liquidity sessions before reversing in the actual direction once the US market opens.

It is important to note that losses can compound later in the week, but over the past eight weeks, BTC price has established its weekly high or low on a Monday.

Bitcoin 4-hour analysis by CROW. Source: X.com

CROW, an anonymous crypto trader, said,

“After wicking to $98,000, Bitcoin price saw a quick return of buying pressure, and the price recovered to above $100,000 within hours. This shows that there is still strong buying interest at lower levels, and the price is unlikely to drop significantly further without any major market event.”)

With the FOMC meeting set to take place between Jan. 28 to Jan.29, market volatility is expected in the coming few days.