Bitcoin price hits another historic ATH; Is the rally sustainable?

After Bitcoin (BTC) has hit yet another all-time high (ATH), many participants in the cryptocurrency space are wondering whether the momentum will stay and for how long, as well as what awaits the flagship decentralized finance (DeFi) asset in the near future.

Specifically, Bitcoin reached a new ATH of $118,780 on July 11, as the culmination of the continuous price growth in the last 24 hours and several days, spiking from around $107,846 on July 8, according to the latest information retrieved from CoinMarketCap.

Is the Bitcoin price momentum here to stay?

As it happens, there were signs pointing at the recent breakthrough before it happened, including tightening supply, compressed volatility, and a coiled market, as observed by the blockchain analytics platform Glassnode in its ‘Week On-Chain’ report on July 10.

Indeed, as the Glassnode team explained earlier, Bitcoin’s supply side was tightening, which means long-term holders and smaller entities were accumulating faster than the issuance. Additionally, volatility has been compressing across all timeframes, indicating a strong possibility of a breakout.

At the same time, another blockchain monitoring platform, Santiment, commented on Bitcoin’s earlier ATH of $113,923, observing the long-term trend of BTC holders increasingly moving their coins into self-custody wallets. In fact, in just the past four months, the amount of BTC on exchanges dropped by 21%, which means that long-term investors are more and more “content to keep their coins safe in personal storage for the long run.”

Meanwhile, Santiment analyst Brian Quinlivan explained in a recent video that things look a “little bit risky right now from a long-term perspective and from a short-term perspective, those wallets that have been active in the past 30 days, their average returns got up to about +8%.” That said:

“Generally, when you see both the long and short-term average wallets (…) well above the average 0%, it’s a sign that we might flatten out for a little while as the FOMOers try to pile in money, expecting us to go to $120,000 and beyond right away – which could happen – but oftentimes, they’ll buy in, the whales will take a breather, take a little bit of profit, and then the price will kind of just coast and be flat for a while or have some mild retraces just to scare away all the people who are FOMOing in right now.

As a reminder, Bitcoin made another significant move upwards – above $109,000 – back on July 2, although, at the time, analysts didn’t think this sudden move would last because of the rising interest from retail investors across different social media platforms.