Bullish On-Chain Signs for Bitcoin, Exchange Balances Lowest Since August 2018

November 03, 2021, 10:15 AM AEST - 3 weeks ago

Bitcoin has historically performed well in Q4, and this year has been no exception. Glassnode’s latest on-chain data suggests that following its recent new all-time high, there are compelling reasons to believe that further upside in the near-term remains most probable.

Low Levels of Profit-Taking

Despite the new all-time high, current levels of profit-taking are mild and more closely reflect activity seen in early bull markets. This would suggest that current holders are, for the most part, waiting for higher prices.

Profit taking seen to be low. Source: Glassnode

Since March this year, long-term HODLers have added 2.42 million BTC to their wallets. Generally, this reflects ongoing bullish sentiments as long-term HODLers tend to offload BTC when the market is overheated.

Long-term HODLer supply. Source: Glassnode

Balances on Exchanges Remain Low

All things being equal, low balances on exchanges tend to demonstrate increased levels of HODLing as investors shift their coins off exchanges into secure cold storage.

Presently, balances on all exchanges have fallen to 2.74 million BTC, a level last seen in August 2018. Since February 2020, the average rate of outflow has been 30,850 BTC per month. Current outflows are around 22,000 BTC per month, or around 71 percent of the long-term average noted above.

These figures could point to a fundamental shift in the historic Bitcoin bull-bear cycles of the past. Could we be entering a new phase, commonly referred to as the “Bitcoin Supercycle”?

Balances on exchanges. Source: Glassnode

Best Yet to Come?

As reported recently by Crypto News Australia, over 70 percent of Bitcoin’s total supply hasn’t moved in five months. This is indicative of enormous conviction that the best is yet to come.

Plan B, one of the most respected voices in the Bitcoin community, has set his price targets for the remainder of the year:

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