BitcoinBusinessPropels

Bitcoin Propels High Amid A Resurging Dollar

In spite of the rebounding U.S. dollar, the key crypto asset largely held on to its gains since the bottom set-in late July, which saw the price remain above $51.5k. During the week, prices ranged from $46,465 to $51,851 a new high for the past 9 days.

Despite the U.S. dollar’s strong rebound at the London trading session, investors continued to wait for clarity about when the U.S central bank will begin asset tapering.

On-chain sentiment remains positive overall, suggesting strong gains in September. A multi-year low remains in spot exchange reserves.

A minimal outflow of Bitcoins to crypto exchanges along with falling transaction counts continue to drive accumulation among miners while aging groups of coins that realized profits during similar rallies are now accumulating again.

This group of coins appears to have sold the initial leg down when BTC was falling back in May 2021, when this group of coins is 12 months old to 18 months old.

During the March 13, 2020, global liquidity crisis, a portion of this group of coins fell from $10k to $3.8k as BTC fell from $10k to $3.8k. Another event in March 2020 could have led to panic selling in this cohort.

The 12-18-month-old coins aged and continued to accumulate as Bitcoin consolidated above $30k to $40k and pushed high to its current price of around $50k after the May 2021 plunge to $30k

Based on Glassnode’s data, bitcoins younger than three months are the ones most likely to be spent during periods of volatility. Yet, a decline in HODL waves for young coins indicates that the market prefers to hoard rather than to spend. A very strong downtrend is in play as young BTC comprise only 15% of the coin supply.

338fefe0a4c55f9fa83af14f518d719b

Demand and supply are seen from the perspective of an investor who does not plan on selling, while an investor who is willing to sell is on the supply side.

In a few short months, these young coins will transform into middle-aged coins (ages 3 months to a year) and old coins (ages 1 year and older). An increasing proportion of these mature coins suggests increasing illiquid supply because they are statistically less likely to be spent.

fa6f35718c1521d1bcb750d1e04cd562

The crypto market is experiencing a powerful maturation trend with almost half of the coins in circulation aged between three months and three years.

.

This article was originally posted on FX Empire

More From FXEMPIRE:

  • E-mini S&P 500 Index (ES) Futures Technical Analysis – Friday’s Reversal Top Suggests Emergence of Sellers

  • Crude Oil Price Update – Short-Term Strength Over $69.79, Weakness Under $68.26

  • European Equities: German Factory Orders in Focus

  • Oil Traders In A Parabolic Scenario

  • The Crypto Daily – Movers and Shakers – September 6th, 2021

  • Ethereum, Litecoin, and Ripple’s XRP – Daily Tech Analysis – September 6th, 2021

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close
Close