Long-term Bitcoin Investors Start Selling Again, Predicting Short-term Weakness

• Bitcoin’s recent performance suggests a shift as long-term investors, who paused profit-taking in early May, appear to have resumed selling their holdings.
• This development is notable because it may indicate a bearish outlook for Bitcoin in the short term, according to Bitfinex analysts.
• Bitfinex analysts stated, “Long-term Bitcoin holders are proceeding with sales again. This development suggests a weakened short-term outlook for BTC.”

Long-term holders resuming Bitcoin sales amidst current market dynamics could pose significant implications for BTC’s short-term performance.

Statistical Insights on Bitcoin

According to CryptoQuant data cited by Bitfinex analysts, the long-term holder output profit ratio is now at 2.7, marking its highest point since CryptoQuant began tracking this metric. Typically, when this ratio surpasses Bitcoin’s fundamental price, it has historically signaled a decline in the digital asset’s value.

Potential Market Impact

The Bitfinex Alpha report highlights that while profit realization is expected during a bull market, the magnitude of current activity raises concerns. Analysts indicated that continued profit-taking by long-term investors could exert significant downward pressure on Bitcoin’s price in the short term, potentially extending the current market downturn and affecting the mid-term bullish trend.

External Factors Adding Pressure

Beyond internal market activity, Bitcoin is also facing potential selling pressure from the anticipated repayments to Mt. Gox creditors, scheduled to start soon. Over 127,000 creditors are expected to receive more than $9.4 billion worth of reclaimed Bitcoin and Bitcoin Cash, which could further exacerbate selling pressure in the market.

Conclusion

The ongoing sales by long-term Bitcoin holders, combined with incoming external pressures such as the Mt. Gox repayments, present a complex scenario for BTC’s price outlook. Investors should remain cautious and stay informed as they navigate these developments, considering the potential for significant market movements in the near term.