Glassnode said long-term Bitcoin holders stayed in profit through the entire cycle, which it said no bear market since at least 2015 has done.
- Bitcoin traded above the $ 86,000 range on Monday, reaching its highest since September.
- Checkonchain's James Check said futures leverage kept declining and funding rates remained below 4% a year.
- According to Glassnode, Bitcoin's largest overhead liquidation cluster sits near $90,000, where leveraged shorts would be forced to close and buy back.
Bitcoin (BTC) edged near $86,300 on Monday, short of its highest close in September, while analysts pointed to a concentration of leveraged short positions near $90,000 potentially setting the stage for a sharper move if the cryptocurrency breaks higher.
The apex cryptocurrency had reached around $86,597 on September 21, its highest close that month, up about 9% from earlier that month. Sunday's close of $86,490 fell about $100 short, and Monday's price a down about 1.75% from the September high.
Bitcoin Nears September High As Shorts Stack Up
The approach has been slow, and Bitcoin’s price was up over 3% over the week.
In terms of daily gains, Bitcoin’s price was up over 1% during the past 24 hours. On Stocktwits, retail sentiment around BTC moved to ‘neutral’ from the ‘bearish’ zone, while chatter stayed at ‘low’ levels over the past day.
Leverage Keeps Coming Down
What stands out is how the climb has been financed. On-chain analyst James Check said in his newsletter Checkonchain that Bitcoin kept stair-stepping higher without giving sidelined investors much of a dip to buy.
Futures leverage continues to decline, the firm said, and funding rates remained below 4% a year. Funding was the periodic payment traders make to hold leveraged positions, so a low rate points to limited appetite for borrowed bets.
Checkonchain also said long-term holders are largely sitting on their hands. Taken together, that leaves buyers in the spot market, rather than leveraged traders, doing most of the work.
$90K Short Liquidation Cluster Could Amplify A Breakout
That matters for what will eventually follow because leverage was concentrated above the current price. According to Glassnode, Bitcoin's largest overhead liquidation cluster sits near $90,000.
If the price reaches that level, leveraged shorts would be forced to close their positions, which means buying back Bitcoin and adding to the move. Smaller clusters sit at about $83,000 and $75,000, the firm said, where the same mechanism would work in reverse. “Either side could speed up the next move,” the firm added.
The Cycle Hasn't Seen A Typical LTH Capitulation
That background was a twist that didn’t distract the usual holders. Glassnode explained that long-term holders stayed in profit through this entire cycle, which it said no bear market since at least 2015 has done. The firm tracked this with a measure called LTH-MVRV, which compared what those holders' coins were worth against what they paid.
A reading below 1 meant the group was underwater. In every previous downturn, that reading fell below 1 at the cycle low. This time it bottomed above 1 and has been climbing since, according to Glassnode.
Analysts See A Different Bitcoin Cycle
Analyst Michaël van de Poppe also came to a similar conclusion. He said investors had expected a correction matching previous cycles, but that the upside during this bull market was smaller than in the past, so the downside did not need to match either. "This cycle is different," he said, adding that it would be remembered as the crypto cycle and calling it "the final easy cycle."
Bitcoin’s 200-Week Moving Average Keeps Rising
One long-term gauge has climbed alongside the price. Adam Back, chief executive of Blockstream and the inventor of Hashcash, said Bitcoin's 200-week moving average has passed $66,000.
Bitcoin has spent almost all its history above that line, and the brief periods below it came near past cycle lows. That is why traders treat it as a long-term floor rather than a trading signal. It now sits roughly $20,000 below where Bitcoin trades today.
Read also: Nasdaq, S&P 500, Dow Futures Steady Ahead Of Fed Minutes This Week: TSLA, SPCX, CBRS, QCOM, PTC, IBRX Stocks In Focus
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