Bitcoin has seen a rebound since retesting the short-term holder Realized Price, a sign that this historical on-chain support may be holding.
When the price of the cryptocurrency is above this metric, it means the holders as a whole are in a state of net unrealized profit. On the other hand, it being under the indicator implies the overall market is in the red.
Where these groups differ is that the investors of the former tend to be weak hands who make panic moves whenever volatility emerges in the sector, while the latter’s members show high-conviction behavior.
To any investor, their cost basis is an important level and since the STHs are particularly fickle, they usually show some kind of reaction when their Realized Price gets retested. This has led to the asset’s price observing various interactions with this metric in the past.
One such interaction may have occurred during the past day, as the below chart shared by the analyst suggests.
As displayed in the above graph, the Bitcoin STH Realized Price currently sits around $107,500. During BTC’s latest dip, its price slightly went under this mark, but found a rebound to higher levels.
Generally, STHs buy to defend their cost basis when the sentiment among them is bullish. In such periods, they believe a price decline to their break-even mark to be a “dip-buying” opportunity
Considering the fact that the asset has been able to find support at the STH Realized Price, it would appear that the STHs still think a bullish regime is on. That said, Bitcoin has only seen a small rebound for now, so it only remains to be seen whether the asset will remain above the level or if another retest would occur.
In the scenario that a breakdown of the metric occurs, the cryptocurrency may face a shift to a bearish trend in the short-term, as it took place in February of this year.
At the time of writing, Bitcoin is floating around $109,200, down 2% over the last seven days.
