Bitcoin HODLers who have held for more than a year vs BTC price
Intro:
Do Bitcoin HODLers fail to take profits at the right time? Do they avoid capitulation at the worst time? Do they sell early in the first rally after a bearish period? The recent data says yes, but that's a change from pre-2021 where HODLer behaviour appears more rational. What changed?
Description:
Here is the Bitcoin price for the last decade and I've added Glassnode's data (orange line) showing the Bitcoin HODLers holding for over 1yr. I thought it was revealing when HODLers failed to be rational. This seemed to become a bigger problem since the start of 2021.
I've marked the local market bottoms with the smiley face to indicate that no one should be selling bitcoins they've held for over a year at this time. Any point near those smiley faces is a time to HODL for sure, yet people often capitulate or sell at the earliest opportunity. The orange line shows people HODLing when it rises upwards and selling when it comes down lower.
The indicator at the top is the BBWP measuring volatility. The indicator at the bottom is showing fear and greed sentiment in the broader market. I forgot to remove these, but perhaps someone will find them useful. The indicator showing whether Bitcoin is overbought (maroon fill) or oversold (lime fill) is publicly available under the name "Abz Bitcoin Investor".
Do Bitcoin HODLers fail to take profits at the right time? Do they avoid capitulation at the worst time? Do they sell early in the first rally after a bearish period? The recent data says yes, but that's a change from pre-2021 where HODLer behaviour appears more rational. What changed?
Description:
Here is the Bitcoin price for the last decade and I've added Glassnode's data (orange line) showing the Bitcoin HODLers holding for over 1yr. I thought it was revealing when HODLers failed to be rational. This seemed to become a bigger problem since the start of 2021.
I've marked the local market bottoms with the smiley face to indicate that no one should be selling bitcoins they've held for over a year at this time. Any point near those smiley faces is a time to HODL for sure, yet people often capitulate or sell at the earliest opportunity. The orange line shows people HODLing when it rises upwards and selling when it comes down lower.
The indicator at the top is the BBWP measuring volatility. The indicator at the bottom is showing fear and greed sentiment in the broader market. I forgot to remove these, but perhaps someone will find them useful. The indicator showing whether Bitcoin is overbought (maroon fill) or oversold (lime fill) is publicly available under the name "Abz Bitcoin Investor".
Comment:
I should have also market Nov 2019 with a "Capitulation" marker. Those diamond hands that held on from there did very, very well.
Absorbing info with every cycle