Bitcoin (BTC) Surges to New Heights, Eyes $130K Amid Bullish Momentum

Bitcoin (BTC) has achieved a new all-time high, trading at $122.6k, signaling renewed investor confidence and bullish momentum in the market, according to Glassnode. This surge has put all BTC investors back into profit, with on-chain metrics suggesting a potential push towards $130k before demand exhaustion sets in.

Market Dynamics and Accumulation Zones

The recent price surge follows a period of consolidation between $100k and $110k, where significant accumulation occurred, particularly in the $93k–$97k and $104k–$110k zones. This accumulation has established robust support levels, setting the stage for potential market pullbacks. The Cost Basis Distribution (CBD) Heatmap indicates that Bitcoin has broken above these dense supply clusters, reinforcing the bullish outlook.

Price Discovery and Investor Behavior

Bitcoin is currently in a new phase of price discovery, with the majority of supply held in profit. The spot price surpasses the 95th percentile level at $107.4k, a critical indicator for identifying market top formation periods. A sharp upward move above this level often triggers heightened profit realization, leading to supply redistribution at higher acquisition prices.

Indicators of Overheated Conditions

Despite the bullish momentum, signs of demand-side stress are emerging. After reaching the new high, Bitcoin prices retracted to $115.9k, aligning with increased investor sell-side pressure. The Short-Term Holder (STH) cost basis suggests that the next resistance lies around $136k, should current momentum persist.

Profit Realization and Market Risks

Glassnode's analysis highlights that the market is nearing overheated conditions, with the Percent of Short-Term Holder Supply in Profit at 95%, significantly above its long-term mean. This metric's stabilization or decline could indicate weakening demand or distribution.

The Short-Term Holder Relative Unrealized Profit metric recently touched overheated levels, reflecting an easing of unrealized gains during the price pull-back. Historically, such conditions mark the beginning of top formation, often followed by prolonged profit-taking.

Conclusion

While Bitcoin's recent performance suggests potential for further gains, the market is entering a phase of increased caution. Short-term holders are experiencing significant unrealized profits, indicating a likelihood of increased profit realization. The market could potentially reach levels around $130k, but investors should be wary of potential demand exhaustion and market corrections.