Bitcoin Bounces Back Above $100K – Is the Bull Run Resuming or a Correction Ahead?

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Following several weeks where it fell short of the significant $100,000 level, Bitcoin kicked off 2025 with a surge of optimistic energy. The digital currency, that had been experiencing difficulties since the previous month, has exhibited indications of rebounding, surpassing the psychological $100,000 barrier for the first time in weeks earlier today.

Initially this year, Bitcoin was fluctuating around $93,000 to $95,000. However, it has recently picked up speed and is now trading at approximately $102,368. In the last day alone, its value has risen by 4.5%, edging closer to its record high of $108,000, which was reached in late 2024.

The surge in Bitcoin’s price is sparking renewed hope amongst both individual and professional investors, as they carefully monitor significant market signals to determine whether Bitcoin will maintain its current pace or if a potential downturn may be imminent.

What Bitcoin Short-Term Holder Realized Price Indicates

Recently, analyst Yonsei Dent from CryptoQuant presented his insights on Bitcoin’s pricing trends, emphasizing that the Realized Price of Short-Term Holders (STH) serves as a crucial benchmark for determining potential turning points in the market.

The Realized Price signifies the typical cost at which short-term Bitcoin owners have acquired their holdings, dividing them into two crucial ranges: one week to one month (weekly to monthly), and one month to three months (monthly to quarterly).

Historically, the 1M-3M range has frequently served as a mid-term support area, whereas the 1W-1M band indicates short-term market trends. When there’s a significant difference between these two bands, Bitcoin typically goes through periods of consolidation or correction until they align once more.

At the moment, Bitcoin seems to be facing obstacles around its one week to one month range. Yet, within the one month to three months period, it’s showing robust support, suggesting a possible chance for medium-term investors to gather holdings, given its potential accumulation phase.

Yonsei Dent underscores the importance of observing the relationship between these two market bands. When they come near each other, Bitcoin might exhibit a spell of relative price consistency as it figures out its next major price trajectory.

Further Upward Momentum Expected?

As a crypto analyst myself, I recently delved into Bitcoin’s recent correction period, observing that although the market seemed to be calming down, several crucial indicators hint at an impending recovery.

Assessing the market’s mood can be aided by various tools like Market Value to Realized Value (MVRV), Adjusted Spent Output Profit Ratio (aSOPR), and Net Unrealized Profit/Loss (NUPL). These metrics provide essential insights.

As a crypto investor, I’m observing that the MVRV ratio, which compares the market price to the realized value of Bitcoin, is sitting at approximately 2.358. This implies that Bitcoin is currently trading at a moderate premium, but it’s not showing any signs of extreme overvaluation.

On top of that, the average Spent Output Profit Ratio (aSOPR) stands at around 1.02. This metric indicates that the majority of transactions are still generating profits for their owners on average, suggesting a generally positive sentiment in the market.

In summary, the NUPL value at 0.58 indicates that investors are generally optimistic about the market, even with the recent ups and downs in prices. Furthermore, Ryu pointed out that short-term traders continue to actively participate in the market, demonstrating their resilience amidst the volatility.

A constant stream of fresh investors indicates a rising belief in Bitcoin’s future worth. Typically, this pattern predicts substantial price increases, implying that the current period of market calm might pave the way for a possible surge.

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2025-01-06 20:28