Investors grapple with uncertainty and indecision as the Bitcoin market absorbs its most significant downturn in the current cycle. However, beneath the surface, a noteworthy shift is taking place toward HODLing and accumulation. As the market recovers from last week’s sell-off, a trend favoring digital asset holders is materializing, according to Glassnode’s latest report.
Since Bitcoin’s ATH in March, the market has seen quite a lengthened phase of supply distribution involving wallets of all sizes. Recently, this trend appears to be reversing, especially among larger wallets usually linked to ETFs. Major players create the impression of returning to accumulation strategies.
The Accumulation Trend Score (ATS) metric, which measures the weighted balance across the market, indicates this shift. The ATS has recently reached its maximum value of 1.0, reflecting substantial accumulation over the past month. Long-Term Holders (LTH), who previously sold off during the ATH run-up, are now favoring HODLing. Over the last three months, over 374,000 BTC have transitioned into LTH status, underscoring a stronger inclination to retain assets rather than sell.
The behavior of Long-Term Holders further supports this trend. Previously, they exhibited significant distribution typical of market peaks. This period saw fewer than 1.7% of trading days with greater distribution pressure. Recently, however, the Long-Term Holders’ supply has shown a positive shift, indicating a renewed preference for holding onto their assets.
Bitcoin Spot Price Analysis and Active Investor Cost Basis
Even after the aggressive distribution from April to July, the spot price of Bitcoin could stay above the Active Investor Cost Basis, which is an average acquisition price for active coins. This suggests underlying market strength, with investors looking to ride positive momentum in the near future.
Looking at the CVD metric, the sell-side bias has remained since the ATH. Positive values of CVD imply net buying pressures; negative values, net selling. Distributionary pressure from Long-Term Holders has slowed because of recent sideways price action; their share of network wealth now stabilizes and increases again.
Even after these investors sold off some of their holdings in the past, the wealth held by these investors remains close to historical highs compared to the previous ATH breakouts. Put differently, it indicates that price action doesn’t matter; holders are becoming increasingly unwilling to sell their assets at lower prices.
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