- BTC appeared to follow the trajectory of the previous bullish cycles of 2017 and 2020, potentially paving the way for a significant price increase.
- Long-term holders were expected to play a crucial role in this phase and contribute to the upward price momentum.
Bitcoins [BTC] has maintained its position above the psychological level of $100,000 for several days, despite broader market declines after an all-time high above $108,000.
Over the past week, BTC has struggled to maintain its monthly profitability, posting a modest gain of 0.64%. An increase of 2.05% was recorded in the past 24 hours.
According to AMBCrypto, these swings could be part of a broader rally as BTC moves toward setting new all-time highs.
BTC to $220,000: A Cautious Journey Ahead
BTC reflected the historical patterns of its 2017 and 2020 bullish cycles, which suggested a potential market peak of $220,000, according to crypto analyst Ali Chart.
As BTC follows this trajectory, it is expected to encounter three major resistance levels, where selling pressure may emerge before resuming its upward momentum.
The market’s continued decline appears to be in line with this broader structure and is moving towards these critical zones.
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Ali Chart outlined the potential price milestones:
“If Bitcoin (BTC) behaves as it did in 2017 and 2020, there will be a short correction after reaching $110,000, a steep correction after reaching $125,000, a major correction at $150,000 and the end of the bull market at $220,000 !”
AMBCrypto analysis indicates that these corrections will likely be influenced by long-term holders, who are currently contributing to BTC’s downward movement.
Long-term holders drive distribution in the market
According to Glassnode, market distribution patterns changed notably after BTC reached a new high and reached the $90,000 mark in mid-November.
During this period, long-term holders (LTHs) initiated a substantial sell-off, taking profits and driving market activity. This sell-off accounted for 54% to 70% of trading volume, amounting to $73-$117 million per hour.
It is striking that a specific market segment is at the forefront of this profitable trend.
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Further analysis shows that the activity is largely driven by BTC holders who have held their positions for 6 to 12 months. This group, many of which gathered during the last market cycle, is responsible for most of the profit-taking in recent weeks.
The Spent Output Profit Ratio (SOPR) for this six- to twelve-month cohort reflects the patterns observed during the 2015-2018 bull market. At that point, the SOPR remained below 2.5 for significant portions of the cycle.
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If history repeats itself, BTC could soon enter a depletion phase where profit taking slows and buying activity resumes. This shift would likely lead to a renewed rally in BTC prices, as we saw in previous cycles.
Read Bitcoin’s [BTC] Price forecast 2024-25
AMBCrypto notes that profit-taking and depletion patterns may persist as BTC reaches new price milestones.
These phases are expected to trigger corrective actions before further rallies. Potential price corrections could occur at key levels including $110,000, $125,000 and $150,000.