Bitcoin (BTC) looked set to challenge critical $47,000 resistance on Tuesday amid a perfect storm of dwindling supply and “exhausted” bears.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
Hodlers vs. whales in the battle for $50,000 retest
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it hit local highs above $46,600 on Bitstamp.
The pair has gained $2,000 since Monday’s lows of $43,700, with analysts hoping that $44,000 would now stick as support.
For Cointelegraph contributor Michaël van de Poppe, $47,000 now formed the level to flip in order to spark a bullish run to the upside.
“On the upside, first, Bitcoin’s price has to break through $47,000, as that’s the current resistance. If that fails, upward continuation to $50,000 is possible as the final hurdle before a potential all-time high test,” he wrote in an analysis for Cointelegraph on the day.
Previously, whale selling behavior had suggested that $47,000 would be difficult to beat.
Meanwhile, fellow trader and analyst Rekt Capital eyed a return of important moving averages as an additional bullish consideration.
Not only is #BTC holding this major demand area as support (orange)…
Not only is $BTC forming a Weekly Higher Low…
But Bitcoin is forming this Higher Low at the 21-week EMA (green)
The 21-WEMA is a valuable time-tested bull market indicator#Crypto #Bitcoin pic.twitter.com/vINfnZOJYa
— Rekt Capital (@rektcapital) September 14, 2021
Strong hand supply hits pre-bull run highs
At $46,000, more of the Bitcoin supply is owned by strong hands than practically ever before, on-chain data confirms.
Related: BTC price nears $46K with Bitcoin exchange reserves lower than November 2020
In its latest weekly report, “The Week On-chain,” analytics firm Glassnode revealed that long-term holders (LTHs) own nearly 13 million BTC — 80% of the supply.
The extent of strong hand belief in Bitcoin this year contrasts strongly with previous eras, and the trend shows no sign of stopping.
Whereas short-term holders (STHs) have regularly formed a major market presence before, even the most recent run to $50,000 failed to shake LTH resolve.
“LTH owned supply has reached 79.5% of all BTC coins this week, which is equivalent to the level reached in October, prior to the bull market kicking off. In fact, on an absolute coin volume basis, LTHs currently own the most coins in history, hitting 12.97M BTC this week,” Glassnode noted.
“Peaks in LTH owned supply typically correlate with late stage bear markets which are historically followed by a supply squeeze and initiation of cyclical bull runs.”Bitcoin LTH/STH supply chart. Source: Glassnode
As Cointelegraph reported, an imminent supply squeeze is a focal topic among analysts this week.