Bitcoin worth is up 40% year-to-date (YTD) and has reclaimed the $23,000 level. Nonetheless, amid ongoing issues about DCG and Grayscale, in addition to macroeconomic uncertainties, many traders query the sustainability of the latest worth rally.

With higher costs, traders may very well be extra motivated to make use of the present worth level to exit and achieve liquidity, particularly after the lengthy and painful bear market of 2022, as Glassnode discusses in its report.

In its newest examine, the famend on-chain analytics agency examines whether or not Bitcoin’s latest surge above the worth it final noticed earlier than the FTX collapse is a bull lure, or whether or not a brand new bull run is certainly on the horizon.

Bitcoin on-chain information suggests

Glassnode notes in its report that the latest worth spike within the $21,000-$23,000 area has prompted the recall of a number of on-chain pricing fashions, which traditionally has meant a “psychological shift in behavioral patterns of holders.”

The corporate takes a have a look at the Investor Worth and the Delta Worth and notes that throughout the 2018-2019 bear market, costs stayed throughout the limits of the Investor Delta worth band for the same interval (78 days) as they’re presently (76 days) .

“This means an equivalence of the continuing ache within the darkest section of each bear markets,” notes Glassnodes.

Along with the length element of the bottoming section, Glassnode additionally factors to the compression of the investor delta worth vary as an indicator of the depth of the market undervaluation. “Taking into consideration the present worth and the compression value, an analogous affirmation sign will likely be triggered if the market worth reclaims $28.3k.”

Concerning the sustainability of the present transfer, the evaluation notes that the latest rally has been accompanied by a sudden enhance within the provide share of earnings, which has surged from 55% to over 67%.

This sudden 14-day surge was one of many sharpest swings in profitability in comparison with earlier bear markets (+10.6% in 2015 and eight.3% in 2019), which is a bullish sign for Bitcoin.

Bitcoin Provide Profitability | Supply: Glassnode

Following final yr’s capitulation occasions, which pushed a majority of traders into the crimson, the market has now transitioned right into a “revenue dominance regime,” which Glassnode says is “a promising signal of therapeutic after the extreme deleveraging pressures of the second half of 2022.”

Much less optimistic, nonetheless, is the promoting stress from Bitcoin Brief-Time period Holders (STHs), historically “an influential think about forming native restoration (or corrective) pivots.” The latest surge has propelled this metric above 97.5% positive factors for the primary time since its all-time high in November 2021, massively growing the chance of promoting stress from STHs.

Bitcoin long-term holders (LTHs) are again above the price base at present costs, which is $22,600, after 6.5 months. Meaning the common LTH is now simply above its breakeven base. In truth, the present development means that the underside could also be in place:

Contemplating the quantity of time LTH-MVRV has traded beneath 1 and the bottom value printed, the continuing bear market up to now has been very akin to 2018-2019.

Bitcoin long-term holders | Supply: Glassnode

Glassnode additionally states that the amount of cash older than 6 months has elevated by 301,000 BTC since early December, proving the energy of the HODLing perception.

However, miners have used the latest worth surge to bolster their steadiness sheets. Miners have spent about 5,600 BTC greater than they obtained since Jan. 8.

In conclusion, the analysis home says that it isn’t but attainable to conclusively assess whether or not the following bull market is imminent or whether or not the bulls are heading right into a lure:

[H]Larger costs and the lure of earnings after a protracted bear market encourage provide to develop into liquid once more. […] Quite the opposite, the availability of long-term holders continues to extend, which will be taken as an indication of energy and conviction […].

At press time, bitcoin worth is standing at $23.085, remaining comparatively calm after the latest surge.

BTC worth motion stays calm, 1-day chart | Supply: BTCUSD on TradingView.com

Featured picture from iStock, charts from Glassnode and TradingView.com