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Is The Bull Market Over Before The Bitcoin Halving? Glassnode Report

The recent drop in Bitcoin’s price, falling below $60,000, has sparked concerns about whether the remarkable bull market of this year might be tapering off sooner than anticipated. Nonetheless, James Check, the leading analyst at Glassnode, reassures bulls that there’s little cause for concern.

Bitcoin’s Pullback: Dip Or Doom?

In a recent video analysis shared on Friday, Check delved into various on-chain metrics focusing on short-term Bitcoin holders, those who acquired their coins less than five months ago.

He highlighted that Bitcoin’s short-term holder MVRV ratio is once again nearing 1.0, indicating that its unrealized profit and loss have reached a breakeven point. This level can act as support following a dip in a bull market, but it also tends to present significant resistance during bear markets when most Bitcoin holders are in a loss position.

Check remarked, “These minor pullbacks are positive. In 2023, we experienced several of these retests. If we assume this trend is robust, we should anticipate the short-term holder cost basis to remain stable, likely in the range of $58,000 to $59,000.”

Similarly, the short-term holder SOPR has recently dropped below 1.0, indicating that short-term holders are now experiencing more losses than gains. If SOPR continues to decline significantly below this threshold without rebounding, it could signal the onset of a prolonged bear market.

This week, there has been a notable spike in realized losses among short-term holders, suggesting that new buyers may have been panic selling at a loss in response to news of escalating tensions between Iran and Israel.

“This is essentially what you want to see as a contrarian,” Check remarked. “As a contrarian, you tend to welcome seeing people making the wrong moves at the wrong times.”

Just days ago, Check observed that Bitcoin’s price might become “top-heavy” if it falls below $58,800. Currently, the asset is trading at $64,000.

Bitcoin’s Long Term Momentum

Additional metrics such as the AVIV momentum indicator indicate that Bitcoin’s price momentum remains positive on longer time frames, with the recent cooldown observed on the 30-day timeframe viewed as a necessary “proper reset.”

In terms of the Bitcoin halving’s financial impact, Check suggests that it may be overstated. When comparing metrics such as Bitcoin futures volume, spot volume, and ETF trade volume, the daily BTC issued to miners represents only a small fraction of the overall market.

“The significance of the halving is more of a narrative game rather than a substantial size factor at this point… It’s just minuscule,” he emphasized.

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