- Bitcoin is in the early stages of HODLing as it becomes more and more popular.
- BTC could be headed for a demand shock.
Will the aggressive Bitcoin [BTC] Bulls wake up when September ends? Well, the king coin just achieved its first bullish September since 2016. Part of the reason for the upward trend could be the perceived shift in favor of HODLing in the long term.
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The idea that Bitcoin’s September performance could be the start of its long-term bull trend is not far-fetched. The cryptocurrency is now closer than ever to a Bitcoin ETF approval, and the outcome could pave the way for a major demand shock due to a tsunami of liquidity.
The shift from taking profits in the short term to holding them for the long term could be one of the first signals.
The bullish expectations echo the sentiments of CryptoQuant analyst Yonsei_dent. The analysis showed that Bitcoin has recently experienced low selling pressure.
More importantly, the number of long-term Bitcoin holders has grown. This coincides with the recently observed bullish momentum. The analysis has this to say about the current state of the market:
“If you look at CryptoQuant’s stock holdings, you can see that they plummeted during the FTX incident in November 2022 and have declined since then.”
Data on the chain reveals this about long-term hoddling
The Bitcoin exchange reserve metric coincides with the statement. Foreign exchange reserves have steadily declined since May. A possible reason for this observation could be concerns about centralized exchanges and their growing popularity.
Source: CryptoQuant
The rise of self-control also confirms that there is a preference for HODLing. The transfer from exchanges to private custody wallets is also consistent with the long-term forecast.
But how can we confirm that Bitcoin does indeed favor long-term holders? Well, the supply of long-term holders has been steadily growing. This means that long-term holders are still not contributing much to the selling pressure. The upside also suggested that many were gathering at the time of writing.
Source: Glassnode
Long-term Bitcoin holders’ position change reversed on September 17, after previously rallying since July. The dip in long-term position change suggested that we may see less pressure in the form of profit-taking in the short term.
Read Bitcoin’s [BTC] Price forecast 2023-24
The last time the same metric showed a turnaround after an earlier rally was from mid-May to late June. Interestingly, there was a spike in demand during that period.
The changing preference for HODLing, coupled with waning selling pressure, could pave the way for accumulation. However, the expected demand shock has not yet arrived and there is still room for whales to put pressure on the market again before the inevitable bull market takes off.