Bitcoin is marching in the footsteps of history. Sharing insights into the coin’s price trajectory, Glassnode’s lead on-chain analyst, “Checkmatey,” has unraveled patterns of BTC’s current position vs. December 2020. Checkmatey highlighted the similarity, considering BTC’s price movement from the peak of its value in April 2021 as the reference point.
The reason behind choosing April 2021 ATH was that the year marked the onset of bearish sentiment in the market, characterized by declining prices and pessimism among investors.
Bitcoin is in the same position as it was in Dec 2020 when measured from the April 2021 ATH. The reason I use April is that’s when bear market sentiment set in, and thus recovery duration should be measured from that point.
However, not all agreed on the specific events shaping market cycles. One user pointed out that the market displayed bullish sentiment four months before November 10, 2021. Some attribute the market’s peak to the Federal Reserve’s decision to switch back to quantitative tightening [QT]. Clarifying the misinterpretation regarding market sentiment, Checkmate explained that the post was about gauging the index price of each cycle rather than market sentiment, emphasizing the importance of the April 2021 ATH as a reference point.
Bitcoin’s SOPR Tells You This
Adding a new twist is the influence of market indicators like the SOPR [Spent Output Profit Ratio], which depicts patterns of unusual behavior. According to Checkmatey, this anomaly spans across all SOPR metrics, suggesting the movement of large and old wallets carrying significant profits. Overall, Bitcoin has not significantly deviated from its position during that time frame, despite fluctuations.
“Even the BTC Shrimp are distributing coins on net currently. Chopsolidation and some bull crabing is the most probable outcome for weeks to months IMHO,” he wrote.
Checkmatey also highlighted the current behavior of “Bitcoin Shrimp” [BTC participants with smaller holdings]. Due to the sell-offs displayed by these cohorts, the market is experiencing choppy and volatile price movements while remaining within a consolidated range. Additionally, the market might have bullish tendencies despite the lack of a clear trend.