In my opinion, the most important point in this chart is that the ratio is currently rising very rapidly to 4.6, approaching the highs seen in the past.
An increase in the LTH/STH ratio indicates that the supply of BTC held by long-term investors is increasing compared to short-term investors. In other words, a significant portion of the coins in the market are passing into more patient hands or being held for longer periods than short-term speculators.
Currently, the ratio is at 4.6, quite close to past highs. Moreover, this increase is occurring after Bitcoin fell from its peak of around $130,000 to $85,260.
Looking at past periods in the chart, sharp increases in the LTH/STH ratio alone do not mean that Bitcoin will immediately fall. On the contrary, in some periods, the ratio has risen as the price prepared for a new uptrend. However, when the ratio approaches extremely high levels, it indicates a change in the market structure and a significant decrease in short-term supply.
Long-term investors continuing to hold BTC instead of selling reduces the liquid supply in the market. If demand strengthens again, the potential for an upward price reaction increases. In this case, the area around $85,000 could become an accumulation zone, and BTC could try to move back towards the $100-$110,000 range, and then to its previous peak. However, caution is needed in the short term due to the 4.6 level and the steepness of the recent rise. The fact that BTC fell from $130,000 to $85,000 also indicates that a significant repricing is taking place in the market. $BTC #bitcoin #BTC☀️
An increase in the LTH/STH ratio indicates that the supply of BTC held by long-term investors is increasing compared to short-term investors. In other words, a significant portion of the coins in the market are passing into more patient hands or being held for longer periods than short-term speculators.
Currently, the ratio is at 4.6, quite close to past highs. Moreover, this increase is occurring after Bitcoin fell from its peak of around $130,000 to $85,260.
Looking at past periods in the chart, sharp increases in the LTH/STH ratio alone do not mean that Bitcoin will immediately fall. On the contrary, in some periods, the ratio has risen as the price prepared for a new uptrend. However, when the ratio approaches extremely high levels, it indicates a change in the market structure and a significant decrease in short-term supply.
Long-term investors continuing to hold BTC instead of selling reduces the liquid supply in the market. If demand strengthens again, the potential for an upward price reaction increases. In this case, the area around $85,000 could become an accumulation zone, and BTC could try to move back towards the $100-$110,000 range, and then to its previous peak. However, caution is needed in the short term due to the 4.6 level and the steepness of the recent rise. The fact that BTC fell from $130,000 to $85,000 also indicates that a significant repricing is taking place in the market. $BTC #bitcoin #BTC☀️
