Bitcoin (BTC) price has been moving sideways over the past 36 hours, as BTC has failed to break out of the $63,600 and $62,843 range. As shown on the chart, BTC is currently below the 50-day EMA but remains above the 200-day EMA on the 4-hour chart.
BTC/USDT on 4-hour chart. Source: Trading View
The Bollinger Bands (BB) indicate that the current price may be oversold, as it is below the indicator's simple moving average (middle line). However, the BB lines are currently trending apart, which suggests that the price may be volatile in the short term.
Bitcoin below $61,600 could test short-term investors’ resolve, says analyst
Bitcoin investors can be divided into short-term (STH) and long-term (LTH) holders, and each group can play an important role. Long-term holders refer to BTC addresses that have held Bitcoin for 155 days or more, while short-term holders are traders who have held for less than that period.
Recently, TinTucBitcoin reported that short-term holders are ‘likely taking higher risks’ at the moment, with BTC’s STH real price spiking. This also coincides with long-term holders ‘likely’ taking profits in late September.
This means that the immediate price movement may depend more on short-term holders at this point. In that context, Burak Kesmeci, a verified Analyst on CryptoQuant, emphasized that STH could panic sell if BTC drops below $61,600.
Average price of Bitcoin short-term holders. Source: CryptoQuant
Kesmeci explained that the current average cost of Bitcoin short-term holders of 1-3 months and 3-6 months is $61,633 and $64,459 respectively. As seen on the chart, the price is currently stuck in this particular range and is waiting for a directional breakout. The analyst stated that the market could strengthen if the $64,500 level is broken. However, Kesmeci added,
“Conversely, if the average cost of 1-3 month holders is 61.6K lost, the patience of Bitcoin investors will be severely tested.”
A drop below $61,600 could see short-term holders ‘panic sell’ at a loss. Data from CryptoQuant indicates that short-term holders are almost unprofitable. The STH Net-Unrealized Profit/Loss by Cohort (STH-NUPL) chart is just above zero, meaning that the majority of short-term holders are currently unprofitable.
Net unrealized profit/loss of Bitcoin short-term holders by group. Source: CryptoQuant
Bitcoin in Q4 is typically profitable during bull cycles
While STH may be forced to sell in a volatile Bitcoin market, historical probability favors holding BTC throughout Q4.
Bitcoin advocate Timothy Peterson recently noted that Bitcoin is having its worst start to October in 10 years. However, Peterson also pointed out that Bitcoin’s Q4 performance is ‘usually positive by a significant margin’.
Bitcoin Q4 returns since 2015. Source: Twitter
Since 2015, Bitcoin has only had negative Q4 returns in 2018, 2019, and 2022, clear bear markets. Considering the overall market in 2024 is in a long-term uptrend, Peterson added,
“I’m looking at 30-60% growth this quarter. I think there’s a 40% chance of hitting $100k by year-end.”
Therefore, short-term holders can continue to hold even though BTC may dip slightly below $61,600 in the coming weeks.
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