Tesla confirmed that this organization holds a large amount of Bitcoin

Analysts at Decentrader point to encouraging hodler behavior that suggests that BTC/USD is far from its cycle top at $56,000.

Bitcoin (BTC) shouldn’t have a problem reaching $100,000 during the current cycle thanks to impressive behavior from hodlers.

HODL Waves stay bullish

In their latest newsletter seen by Cointelegraph, analysts from trading suite Decentrader including Cointelegraph Markets contributor filbfilb sought to allay fears that Bitcoin’s bull run is running out of steam.

Backing their optimism, they said, is data showing that more and more investors are hodling BTC for the long term — one year or more.

Taken from the popular “HODL Wave” indicator, this suggests that there is less desire to sell Bitcoin at short notice at a certain price, providing a solid foundation for further growth.

“The 1Yr+ HODL Wave suggests that Bitcoin should comfortably reach the $100,000 level during this cycle,” Decentrader summarized.

“The greater the amount of Bitcoin being held for a year or longer, the less liquid the supply or potential selling pressure there will be. Typically, if 50% or more of Bitcoin is being HODLed the bull market continues, below this is potentially cause for concern.”

HODL Waves tracks the proportion of the existing Bitcoin according to when it was last used in a transaction. Previously, Cointelegraph noted that those who bought BTC during the 2017 bull run had largely held onto their position despite realizing significant gains.

Locking down the BTC supply

As Cointelegraph reported on Monday, roughly 36% of the circulating Bitcoin supply is currently made up of “younger” coins which have moved at some point in the past six months.

Exchange data further reinforces the pro-hodl mindset among investors, as overall reserves continue to plummet in March despite BTC/USD making a new all-time high.

Even miners appear to be increasingly interested in keeping their BTC rewards, as evidenced by figures from on-chain analytics service Glassnode showing net miner positions turning positive this month. Michael Saylor, CEO of MicroStrategy, described their behavior as “onlyrational.”

“Strong holders are increasing their positions. Another sharp increase of #Bitcoin in the illiquid wallets,” quant analyst Lex Moskovski commented on another Glassnode chart.

Elon Musk, CEO and “Technoking” of Tesla, became the most recent high-profile hodler when he announced on Wednesday that the carmaker would offer products for BTC and not convert the revenue to fiat.

According to Bitcointreasuries.org, Tesla currently holds an estimated 48,000 BTC, a number that should grow as people exchange their Bitcoin for the company’s electric vehicles.

Bitcoin price sits at $ 15500 when there are many Bitcoin whales selling

Bitcoin whales sold the highest amount of BTC since March, which is a bullish sign for BTC price based on previous market cycles.

The price of Bitcoin (BTC) has reclaimed $15,500 on Nov. 11 after whales sold the highest amount of BTC since March. In the past cycles, the dominant cryptocurrency typically rallied after a sell-off from whales.

On March 12, for instance, the All Exchanges Inflow Mean (MA7) indicator hit 3. At the time, BTC declined to as low as $3,596 on BitMEX after seeing cascading liquidations.

Since then, the MA7 has never increased above 1.7. On Nov. 11, for the first time since March, the MA7 neared 2. This indicates that whales sold a significant amount of BTC in the past few days.

All Exchanges Inflow Mean. Source: CryptoQuant

Why does big Bitcoin sell-off indicate a bull trend?

Bitcoin whales, or high-net-worth individuals who hold large amounts of BTC, do not necessarily short BTC because they are bearish.

Many whales prefer to take profits amidst a bull run and build up positions along the way. This is because whales trade substantially larger positions than most retail traders. As such, they seek liquidity and high buyer demand to sell or adjust their positions.

Bitcoin tends to rally after a whale-induced sell-off as it decreases selling pressure on the cryptocurrency in the short to medium term.

While the Bitcoin market has become more evenly balanced among retail traders, institutions, and whales, high-net-worth individuals still impact the market.

Ki Young Ju, the CEO at CryptoQuant, emphasized that Bitcoin has historically rallied after “victim whales” deposit BTC to exchanges. He wrote:

“The buy-the-dip indicator. Buy $BTC when victim whales deposited to exchanges after the plunge.”

Bitcoin has seen extreme volatility in the past week, possibly as a result of whales taking profits. However, every major dip was aggressively bought up by other whales and retail investors.

Major Bitcoin dips bought up since early November. Source: TradingView.com

BTC recorded large drops on Nov. 8, Nov. 10 and Nov. 11. Bitcoin recovered from every pullback with strength, rebounding to previous support levels within a matter of hours.

On-chain fundamentals are also highly positive

Atop the favorable technical structure of Bitcoin, on-chain fundamentals signify an overall bullish outlook.

According to Glassnode’s data, the number of active Bitcoin addresses achieved a multi-year high. Elias Simos, Bison Trails protocol operations manager, said:

“Did you know that $BTC active addresses hit a multi-year high this week, and are now at Jan-2018 bubble top levels? In the chain’s entire history, it’s only been about 1.5 months that aa’s stood at > 1M. How about that.”

Daily active addresses is an important on-chain metric for Bitcoin because it could indicate two key trends.

The number of active Bitcoin addresses. Source: Glassnode

First, retail investors might be increasingly accumulating BTC and transferring to personal wallets. This shows an intent to “HODL” Bitcoin for a prolonged period.

Second, there could be an increase in over-the-counter (OTC) deals, particularly among whales and high-net-worth individuals.

The combination of positive technical and fundamental trends raises the probability of a broader rally before the end of the year. With the halving occurring just 6 months ago, the chances of a more sustainable uptrend remain high.