Bitcoin Holders Await Breakout to Restart Market Activity

Cryptocurrency is currently experiencing a liquidity slump, with traders waiting for a breakout to trigger market activity. According to analysts, Bitcoin holders are sitting on the sidelines until a clearer market direction emerges.

On Oct. 9, Glassnode head analyst James Check highlighted this point in an X post, stating, "Investors need a new price range to re-awaken supply." He also noted that Bitcoin's sell-side risk ratio is trading "deep into the low liquidity zone."

As Check further explained, "The vast majority of coins moving around onchain are NOT booking large profit, nor loss."

In periods of Bitcoin price consolidation, experienced traders often prefer to sit out and wait for a stronger market signal before making a move, Cointelegraph reported.

"Best to wait for confirmation in times like these," Daan Crypto Trades noted on Oct. 9. Both scenarios are still possible, according to Check, who suggested that the market could be setting up "for either a الكبير sell-off event to create capitulation level fear, or a الكبير rally to restart the profit taking engines."

Meanwhile, Check's analysis also showed that long-term holders, sometimes referred to as "old hands," are largely sitting on their Bitcoin. Those who have held for 182 days or more are displaying the highest level of passivity.

"As it stands, Old hands are sitting on their coins, with volumes aged 6 months and older being remarkably dormant," Check noted.

On the other hand, Bitcoin holders with a holding period of 155 days or less are sitting on an unrealized loss at current BTC price levels, Bitbo data shows.

The average price at which short-term investors have purchased Bitcoin, also known as the short-term holder realized price, is $62,426, according to the latest available data.

Several crypto analysts have highlighted indicators suggesting that Bitcoin price is likely to break out of its consolidation zone soon.

"Bitcoin consolidation setting up for a الكبير move. Lower time frame support holding strong. Expecting a breakout soon," blockchain investor Ash Crypto noted in a post on Oct.10.

Moreover, investor Mike Alfred's analysis pointed to a potential breakout in either direction, with a close above $61,000 signaling a move toward $65,000 and a drop below $57,000 setting the stage for a slide to $52,000.