Bitcoin “Bullish Scenario” Possible After Reaching $47,000, Blockware Analyst

AnalysisBitcoin "Bullish Scenario" Possible After Reaching $47,000, Blockware Analyst



Arman Shirinyan

Uptrend on Bitcoin is still possible despite questionable performance of the currency in April

Contents

The uptrend everyone is expecting on the cryptocurrency market may in fact start after conditions described by Blockware lead analyst Will Clemente are met.

Short-term holder cost basis

The cost basis term is often used to describe the average entry price of investors into an asset. The short-term holder cost basis shows that the average entry of short-term Bitcoin holders is currently at $47,000.

Whenever the short-term cost basis crosses the HODLer Implied Price, investors receive either bullish or bearish signals, depending on the direction of a cross. In the current case, if Bitcoin continues to drop further, the market will most likely dive deeper as selling pressure from short-term traders aggravates.

HODLer implied price

The second metric used by the Blockware analyst is the HODLer implied price, which is essentially the realized price of an asset divided by its liveliness, which is a metric that reflects the behavior of holders by measuring the number of liquidations which causes a metric’s rise. In case coins remain dormant, the metric declines.

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If the HODLer implied price metric crosses the short-term holder cost basis, the market should expect a rise in liquidation volume, which creates enormous pressure on the price. In case STH distances from the HODLer implied price, the market remains more stable.

While Bitcoin’s move above $47,000 may become an extremely bullish event for the cryptocurrency market, we may still see enormous pressure on the price as some traders may decide to break even on their positions after a massive 20% dip.

At press time, Bitcoin is trading at $40,456 after tumbling down to $38,111, which caused extreme fear on the market.



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