Bitcoin’s short-term holders are increasingly liquidating their assets, which is dampening demand momentum in the market.
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Recent data reveals that Bitcoin demand momentum has plummeted to -480k BTC, indicating a more aggressive selling pattern among short-term holders compared to long-term holders.
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This spike in short-term selling pressure is dampening Bitcoin’s ongoing price rally, highlighting a shift in market dynamics.
Over the past week, Bitcoin [BTC] has witnessed substantial price increases, but most short-term holders now find themselves in profitable positions.
Consequently, in the last 10 days, these holders have begun selling their Bitcoin for profit, as evidenced by the short-term holder spent output profit ratio (STH SOPR) remaining above 1 throughout this period.
Source: CryptoQuant
In light of rising profitability, short-term holders are seizing the opportunity to realize gains by exiting their positions.
STHs dominated outflows as demand momentum dropped sharply
Selling pressure from short-term holders has surged, reflected in the 30-day Demand Momentum’s sharp decline.
The current negative reading of -480k BTC as reported by CryptoQuant indicates that short-term holders are offloading Bitcoin at a higher rate than long-term holders.
Source: CryptoQuant
Data shows that short-term holders dominate inflows into exchanges. Over the past day, those holding Bitcoin for less than a month have sent more than 26k BTC to exchanges, a trend persisting over the previous week.
Source: CryptoQuant
This surge in selling activities is significant. Over the past three days, Bitcoin’s Spot Volume Delta (7DA SMA) turned substantially negative, reaching a net value of -301 million—a strongly bearish signal.
This considerable drop indicates aggressive selling activities that are compromising spot demand, suggesting a potential reversal as buyers appear diminished.
Source: Glassnode
The increase in profit-taking has pushed the Profit-Taker RSI (7D) to 82, indicating heightened realized profits and increasing sell-side pressure against rising Bitcoin prices.
Currently, the market is under the influence of sellers, particularly short-term holders, while long-term holders are maintaining their positions and not contributing to the selling.
What this means for BTC
Bitcoin currently faces a critical juncture.
The divergence between aggressive selling from short-term holders and the steadfastness of long-term holders suggests potential consolidation. With long-term holders absorbing selling pressure, Bitcoin may remain within a range of $92K to $95K.
To achieve a surge above $96K, a significant easing of short-term holder selling is essential; otherwise, any bullish momentum could stall.
