This year has seen a multitude of optimistic Bitcoin [BTC] forecasts, with numerous experts voicing confidence in BTC’s potential to exceed $100,000.
The recent uptrend in Bitcoin sparked a wave of Fear of Missing Out (FOMO), as evidenced by the increase in the number of BTC addresses.
As per CryptoQuant, the latest Bitcoin rally was characterized by a surge in active BTC addresses.
This not only signaled a strong belief in the current market conditions but also indicated a desire not to miss out on the rally.
On November 3rd, the number of active addresses stood at a low of 766,947, but it has since surged to over 1.18 million addresses by November 12th.
This correlation highlighted a direct link with the price surge.
The rise in active Bitcoin addresses also mirrored the significant inflow of funds into ETFs during the same period.
Is the buying pressure on Bitcoin diminishing?
While active addresses have been fueling the bullish trend, recent data suggested an increase in profit-taking activities.
This was particularly notable among a specific group of long-term holders who have held BTC for 6 to 18 months, primarily in the spot market.
The data revealed that buyers who recently sold their holdings had been accumulating since May 2023, with those who held on until recently enjoying gains of over 200% during the 18-month period.
According to CryptoQuant, these mid-term holders had entered the market at an average price of around $28,000.
Approximately 230,000 BTC were transferred from addresses holding for 6 to 12 months between the 3rd and 12th of November, with about 41,500 BTC moved from addresses holding for 12 to 18 months.
Could this signify the end of the recent bullish trend?
An increase in selling pressure from mid-term hodlers might suggest that Bitcoin is poised for a significant correction.
The price recently hit a peak of $89,940 during the trading session on November 12th and has since displayed signs of bullish exhaustion and increased selling pressure.
Bearish sentiments have been growing due to the steep overbought conditions in the market.
The selling pressure from mid-term holders not only indicated a rise in profit-taking but also hinted at the possibility of long-term holders anticipating pullbacks following BTC’s recent rally.
While a pullback at current levels seems rational, positive expectations remain high, especially as 2025 approaches.
The upsurge in active BTC addresses suggested that FOMO could help uphold a higher price support level and stimulate additional buying interest, as investors continue to view Bitcoin as an appealing asset below the $100,000 threshold.