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The consistent demand from retail for Bitcoin The $100,000 limit, which indicates high investor confidence, has recently attracted attention. However, with short-term bonds driving the current accumulation trend, market watchers are warning of a possible drop to $95,000.
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Private investors are accumulating at a record pace
Retail investors, including smaller holders referred to as “Shrimp” and “Crabs,” have enthusiastically collected Bitcoin. Glassnode reports that these groups collectively added 25,600 BTC to their portfolios in the past month. That’s nearly twice the amount of newly mined Bitcoin over the same period, a sign of significant demand for the “digital gold” at its price peaks.
Demand from private investors #Bitcoin at prices around $100,000 remains strong – The Shrimp-Crab Cohort (up to 1 and 10 #BTCrespectively) absorbed 1.9x the newly mined Bitcoin supply last month, a total of +25.6k $BTC: https://t.co/l0sjVN2Toi pic.twitter.com/UdzcCWXAGo
— glassnode (@glassnode) January 23, 2025
The purchasing activity of these smaller investors points to an even broader trend of retail enthusiasm. Nevertheless, experts should still exercise caution. While this degree of accumulation is remarkable, the dominance of short-term holders (STHs) in this increase introduces an element of risk to market stability.
Short-term holders pose a risk
STHs are often sold during slight declines to ensure profits and are known for their quick responses to market changes. Particularly in cases of unexpected volatility for Bitcoin, this reflexive behavior could trigger higher selling pressure. Teddy, a market analyst, underlined that the existence of STHs could have a major impact on temporary price fluctuations.
While STHs (Short-Term Holders) have indeed absorbed a significant portion of the newly mined Bitcoin supply, it is crucial to take into account the behavioral tendencies of this group. STHs have historically been more susceptible to panic during small market swings, often resulting in… pic.twitter.com/dasfRgjOFR
— Teddy (@TeddyVision) January 23, 2025
Historically, the markets have also been more sensitive to the downtrends with STH. Analysts believe that, in addition to this prevailing trend, caution would be wise for investors at such levels.
Glassnode: Narrow Bitcoin Range
Another anomaly Glassnode has noticed in Bitcoin price action is an unusually tight range over the past 60 days. Such events have set precedents for the volatile times ahead.
This coincides with historical trends, which indicate that the market will soon experience a breakout or a collapse. While the persistent $100,000 price level reflects optimism, the market’s narrow range adds an air of unpredictability.
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A possible relapse soon?
Considering all these factors, some experts believe that Bitcoin may see a minor price adjustment in the near future. Some experts, such as market veteran Michaël van de Poppe, predict one withdraw to $95,000mainly due to the sale of STHs in the face of market uncertainty.
For now, retail demand remains a solid source of support at $100,000. However, investors should brace for volatility and pay attention to market indicators. As Bitcoin approaches its peak, the interaction of retail euphoria and market risks will determine its next steps.
At the time of writing, Bitcoin was trading at $105,141, up 3.2% and 3.2% in the daily and weekly time frames.
Featured image from Vecteezy, chart from TradingView
