Did the historical line support Bitcoin’s recovery?

The on-chain data for Bitcoin suggests that a historical support line may have once again helped the coin, as it has recovered towards $28,000 today. Glassnode, an on-chain analytics firm, has reported that the BTC price approached the cost basis of short-term holders recently. The “realized price,” which is a metric derived from the “realized cap,” is the relevant indicator here. The realized cap refers to a capitalization model for Bitcoin that accounts for the price at which each investor acquired their coins. The short-term holders (STHs) are all those investors who bought their coins less than 155 days ago. The BTC holders outside this group are termed the “long-term holders” (LTHs). The STH realized price has apparently interacted with the spot price of the asset, and when the price dropped below this indicator, it signaled a change of trend. However, this isn’t an unusual pattern, as bullish periods have historically observed the metric helping the price. Recently, Bitcoin found some struggle as the price plunged towards the $26,000 level. The consolidation near this level meant that the price was fast approaching the STH realized price, which was slowly going up. When Glassnode posted the chart yesterday, it described this current state as a “decision point” for the market. According to the analytics firm, a successful retest here would be a sign of strength in the bullish trend, while failure would imply weakness. At the time of writing, Bitcoin is trading around $27,900, up 4% in the last week.

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