Bitcoin Surpasses $50,000 Mark: Transitional Phase Beckons as Potential Profits Arise
Summary:
Bitcoin's (BTC) value surpassed $50,000 on February 12th, for the first time since December 2021, marking a 15% rally. Although BTC presently faces overhead resistance at $50,000, data suggests the market may be entering a transitional phase, providing majority investors a profit-making opportunity. Despite a short-term reset, spot Bitcoin ETFs have witnessed high net inflows, suggesting a favorable trend in Bitcoin investments.
For the first time since December 2021, Bitcoin's (BTC) trading value surged past $50,000 on 12th of February. A rally increase of 15% was observed this February. Nevertheless, BTC's daily chart divulges a formidable resistance at $50,000, resulting in a 2% price drop on February 13 in response to the United States Consumer Price Index (CPI) report. The report indicated an annual inflation of 3.1%, exceeding the consensus anticipation.
As per the data from Glassnode, blockchain analytics firm, Bitcoin followers have commenced 2024 on a positive note, although the market may be shifting towards a transformative phase. Glassnode reports show long-term Bitcoin HODLers (holders of last resort) have expended over 300,000 BTC since November 2023. Since 2021, Bitcoin has marked a daily closing above $50,200 only for 141 days, representing merely 2.84% of its total trade history.
This pricing scenario places a majority of investors in an advantageous position where they might begin reaping profits. To illustrate, only about 13% of total circulating assets are in a loss above the $48,000 margin. This corresponds with BTC's recent Unspent Transaction Output (UTXO) ratio info. The UTXO ratio delineates the number of transactions in profit or loss by juxtaposing the price at the time a particular UTXO was generated or eradicated. A high UTXO ratio indicates that the coins have remained static since their creation in that transaction. The UTXO ratio soared to 96.62% once BTC surpassed $50,000, an indication of increasing profits for investors.
However, short-term Bitcoin proprietors went through a recalibration. During the rally fueled by the spot Exchange-Traded Fund (ETF), the supply of STH unearthed profits that peaked at 100%, before dropping to an average of 57.5% following the correction of BTC to $38,000.
Meanwhile, the past weeks have witnessed considerable net inflows into the Bitcoin ETFs, as indicated by Eric Balchunas, Bloomberg's Senior ETF Analyst. The cumulative net flows for 10 ETFs have now exceeded $3 billion. Another study from CoinShares illustrates the total Crypto Assets Under Management (AUM) at $59 billion - the highest since 2022. This elevation in Bitcoin ETF input has driven the Coinbase premium index into a net premium, thereby signaling rising buyout pressure on the stock exchange.
This news piece does not present any investment advice or suggestions. Investing and trading entail risk, so readers are advised to do their own comprehensive research before making a decision.
Published At
2/14/2024 12:30:00 AM
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