The Bitcoin bull season continues to present several reversals as expected from a highly volatile market. In line with the heightened hopes of several investors, some network statistics indicate that the price gains are far from over. Currently, the first cryptocurrency is trading above $104,400 after a significant price increase in the past week.
Bitcoin Still Presents Upside Potential – Analysts
In one Quick post at CryptoQuant, an analyst with the username onchained provides an intriguing market analysis based on Bitcoin Unspent Transaction Outputs (UTXOs) over the past two to five years (2Y-5Y).
For context, UTXO refers to the remaining balance of a cryptocurrency transaction that has not yet been spent by the recipient. UTXO are the building blocks of blockchain transactions and can be used to interpret holder behavior, market sentiment and price cycle dynamics, among other things.
2Y-5Y UTXOs represent Bitcoin held by long-term holders who have not moved their money during this time. Data from 2Y-5Y UTXOs showed that these holders started recording profits when Bitcoin reached $68,000 in early November.
However, such profit realization suggests renewed momentum rather than the end of the bull market. This is because the selling pressure is neutralized by an equal demand from other participants and in this case short-term holders.
Onchained further explains that this profit-taking provides a negative weekly change in the realized price for long-term holders, which is essential for a healthy market structure with the potential for further price gains.
Additionally, the MVRV ratio of this 2-5 year UTXO cohort has consistently reached 1 to signal any macro market during previous bull cycles. MVRV measures market value to realized value and is used to indicate potential reversals by determining whether an asset is overvalued or undervalued.
Currently, the MVRV ratio is approaching 4 which supports the view that Bitcoin still has a lot of room for price growth in this bull run.
The Coinbase Index is moving above 100
In other news, the Bitcoin Coinbase Premium Index has now risen above 100, indicating strong election activity. However, cryptanalyst with CryptoQuant username Avocado_onchain stated this increase is not significant enough to suggest any accumulation battles among cetaceans.
Avocado_onchain further states that both positive and negative Coinbase Premium Index are needed to signal a continuation of Bitcoin’s current. At press time, Bitcoin is trading at $103,601 after a gain of 2.44% in the last 24 hours. On larger time frames, Bitcoin has a steady gain, as indicated by gains of 10.76% and 2.31% over the past seven and 30 days, respectively.
Featured image from Forbes, chart from Tradingview
