Market analyst MorenoDV_ reports on the muted reaction of short Bitcoin (STH) holders to the joint US-Israeli attack on Iran. The observation is important given the earlier sell-offs that have dominated the market in recent months.
Bitcoin STH’s Reaction to Geopolitical Conflict Shows Seller Tired – What’s Next?
Bitcoin short-term holders refer to a group of investors who have acquired Bitcoin within the last 155 days. They are characterized as a reactive set of investors, and as such, activity often reflects short-term volatility and price direction.
According to MorenoDV_ in a February 27th QuickTake post, these short-term holders indicate a moderate market reaction to rising geopolitical tensions in the Middle East following the coordinated US-Israeli attack on Iran. Using data from the Bitcoin STH P&L to 24H exchanges, a well-known market analyst reports that the entry into the exchanges has decreased, which indicates that there is no gain or surrender of losses, even despite the event that historically caused mass selling.
MorenoDV_ explains that this change in market behavior follows a major market cap between February 5-6, when short Bitcoin holders sent 89,000 BTC to exchanges at a loss in 24 hours. After this event, loss inflows have steadily decreased, indicating either the fatigue of sellers or a positive transition from panic to patience.
Due to the conflict between the US, Israel and Iran, there was no momentum in the STH exchange, even as prices fell to around $63,000-$64,000. MorenoDV_ notes that this important observation indicates a complete exit from the market of weak hands as well as a significant absorption of recent liquidation pressure.
Looking ahead, if STH holders have a muted reaction to other bearish triggers, it would suggest a phase of market stabilization that has historically preceded market recovery arcs. On the other hand, increasing STH exchange inflows and realized losses indicate that the market decline is incomplete and investors are still at risk of further declines.
Bitcoin price overview
At the time of writing, Bitcoin is worth $67,007, reflecting a slight increase of 4.41% in the last 24 hours. In tandem, the daily trading volume increased by 0.81% and amounted to 40.81 billion dollars.
The premier cryptocurrency continues to move within a certain range of $60,000-$70,000, as seen for most of February. While analysts continue to speculate about the end of the cycle, conditions for a bullish return, such as a recovery in ETF inflows, increased demand for LTH or a dovish outlook for the Fed, are also absent.
