Glassnode Report: Has the Bitcoin Bull Market Ended Before the Halving?

Indra55

Bitcoin's latest price drop below $60,000 has raised questions about whether this asset will end its remarkable bull market earlier than expected this year. However, according to James Check, Chief Analyst at Glassnode, investors in the bull market have little to worry about.

Bitcoin's pullback: Minor decline or catastrophic crash?
Check reviewed various on-chain indicators regarding short-term Bitcoin holders who bought their Bitcoin for the first time about five months ago. Firstly, the Short-Term Holder Market Value to Realized Value (MVRV) ratio for Bitcoin is now approaching 1.0 again, indicating that unrealized profits and losses have reached a breakeven point. This level can act as support after a bull market pullback, but during bear markets, it could also serve as a significant resistance when most Bitcoin holders are at a loss.

Check said, "Minor drops are good. We've had several of these retests in 2023. If we think of this as a resilient uptrend, we should expect the cost base of short-term holders to hold in the $58,000 to $59,000 range."

Similarly, the Short-Term Holder Spend Output Profit Ratio (SOPR) recently dropped below 1.0, meaning short-term holders are now realizing more losses than profits. If SOPR significantly drops below this level without recovering, it could be a signal of a continued bear market in the future. As of this week, short-term holders have realized significant losses, indicating panic selling due to escalating tensions between Iran and Israel.

Check added, "This is essentially what you want to see as a contrarian investor. As a contrarian investor, you kind of hope to see people doing the wrong things at the wrong times."

Bitcoin's long-term momentum
Other indicators, such as the Average Value Invested (AVIV) momentum indicator, suggest that Bitcoin's price momentum remains positive over longer time frames, experiencing only one "proper reset" over a 30-day period for cooling down.

Regarding the Bitcoin halving itself, Check believes its financial impact may have been overhyped. The daily issuance of BTC to miners is only a small fraction of the market compared to Bitcoin futures trading volume, spot trading volume, and ETF trading volume.

He said, "The scale of the halving is now more of a narrative game rather than a consideration of actualities."

Yamini003

Regarding this game, we also need to take a look at it.

Jafar224

This also indicates that there's still a rhythm of a bull market.

Ritu13

It's likely that most people find it difficult to judge such matters.