Key Points
- Bitcoin holders are anticipating higher prices, with over $7 billion in unrealized profits currently held.
- Bitcoin exchange flows have decreased to their lowest levels this year, indicating a potential volatility resurgence.
Bitcoin investors’ anticipation for the cryptocurrency to reach the $70,000 price level is evident. The massive amount of unrealized profits is a clear sign that holders are choosing to HODL, expecting higher prices.
The recent CryptoQuant analysis reveals that Bitcoin presently holds over $7 billion in unrealized profits. This finding emphasizes the prevalent HODLing and the expectation of increased price levels. However, it also points out the possibility of a significant retracement if or when profit-taking recommences.
Bitcoin’s Current Trading Status
If Bitcoin holders begin to take profits, the sell pressure may result in a scenario similar to what occurred at the end of July. During that period, the price severely dropped within a few days. The prevailing optimism has so far allowed Bitcoin to maintain its gains.
At the time of reporting, Bitcoin was trading at $68,350, which is less than 2.4% away from hitting $70,000. The cryptocurrency also appeared to be approaching the next resistance range between $69,400 and $71,500.
Bitcoin Exchange Flows
Bitcoin exchange flows could provide us with intriguing insights into the crypto’s recent bullish wave. The latest increase in both exchange inflows and outflows occurred between 13 and 16 October. However, exchange flows have since declined to their lowest levels this year.
Data showed that 3,760 BTC moved out of exchanges in the last 24 hours. Approximately 3,940 BTC moved into exchanges, indicating that exchange inflows were slightly higher than the outflows.
Exchange flow fluctuations suggest that Bitcoin might be ready for a volatility resurgence. However, whether another swing up will have bullish or bearish energy is yet to be determined. Address flows may provide some insights.
The number of active sending addresses has been dropping since mid-October, falling from 860,161 addresses on 15 October to 478,148 addresses by 18 October. Conversely, receiving addresses increased from 379,545 addresses on 13 October to 625,308 addresses on 18 October.
The data also showed that the number of addresses purchasing Bitcoin was not only higher than those selling it, but receiving addresses increased while sending addresses decreased. This activity confirms a shift, demonstrating declining sell pressure despite the recent price increase. While these results suggest that Bitcoin may push higher, a sudden wave of sell pressure may still be possible.
