- BTC’s foreign exchange reserves have fallen to their lowest level this year.
- Bitcoin, which left the reserves of the exchanges, stood at 2.6 million BTC.
Bitcoin [BTC] has once again breached a key resistance level, rising above $65,000, a level it has struggled to surpass for more than eight months.
This recent surge has created bullish momentum, meaning BTC is gaining strength.
A key sign of this positive outlook is the decline in Bitcoin exchange reserves, which have reached their lowest level of the year.
The reserves amounted to approximately 2.6 million BTC. This decline indicates that both short- and long-term owners are becoming less willing to sell. It has fueled expectations of further price increases.
Historically, lower foreign exchange reserves have been associated with bullish market sentiment as they indicate a reduced likelihood of short-term selling pressure.
Source: CryptoQuant
Bitcoin’s accumulation trend among long-term holders has been steadily rising since 2014, and the number of addresses holding BTC for over a year is now at an all-time high.
This strong accumulation by long-term investors supports a higher price trajectory for Bitcoin.
According to data from IntoTheBlock, the number of addresses that have held BTC for more than a year increased by 0.35% over the past month.
Currently, more than 38 million addresses have held Bitcoin for over a year, while 13 million addresses have held for one to twelve months.
Source: IntoTheBlock
Only 2 million addresses have held BTC for less than a month, underscoring the dominance of long-term holders.
This long-term accumulation trend is a bullish signal. This indicated that more investors are confident in Bitcoin’s future growth and are holding their positions for potential profits.
BTC’s Apparent Demand
Another positive indicator for Bitcoin’s price is apparent demand, which measures the difference between production and changes in supply.
In the context of Bitcoin, production refers to the issuance of new BTC through mining, while inventory refers to the supply of Bitcoin that has been dormant for over a year.
When inventory reduction is greater than new production, it indicates increasing demand for Bitcoin.
Source: CryptoQuant
This increased demand, combined with limited supply, typically drives prices up.
Given recent trends, demand for Bitcoin appears to be on the rise, further supporting the case for continued price increases.
Realized price of new versus old whales
The average purchase price of new whale investors is currently around $62.2K, while more experienced whales have an average purchase price of $26.9K.
With Bitcoin now trading above these key price levels, it becomes less likely that whales will sell their holdings until the market cycle peaks.
Source: CryptoQuant
Read Bitcoin’s [BTC] Price forecast 2024-25
This consolidation of whale buying around current levels reinforces the belief that Bitcoin’s price is about to head higher.
Large investors typically hold their positions during an uptrend, adding further stability and confidence to the market.