Bitcoin recently surged past the $90,000 mark, reaching an all-time high of $93,265 on November 12. However, it has since dropped 6% to $87,757. This retreat is attributed to profit-taking by short-term holders who swiftly capitalized on gains.
On-chain analysis using Bitcoin’s Spent Output Age Bands reveals that short-term holders, who typically control coins for under 30 days, have been selling their holdings, contributing to the decline. This selling pressure is connected to increased activity in the younger age bands of BTC holders.
These investors moved notable amounts of Bitcoin, with those holding for a day transferring over 1 million BTC. This activity underscores the impact of short-term holders on market sentiment and Bitcoin's price volatility, often resulting in transient fluctuations.
Conversely, long-term holders, those retaining Bitcoin for over a year, have shown minimal movement in their holdings. This relative stability suggests that short-term volatility stems primarily from profit-driven transactions by newer investors.
Looking ahead, Bitcoin's future movements depend heavily on short-term holder behavior. Should they continue selling, Bitcoin's price might face further downward pressure, potentially targeting $83,792 or even lower, around $76,356, based on the Fibonacci Retracement tool.
If these short-term investors hold back from selling, it could avert a bearish outlook. This restraint may pave the way for Bitcoin to reclaim the $90,000 level and rally towards $100,000, rekindling optimism for further upward movement.
