The cryptocurrency market started the weekend with a notable price drop as Bitcoin fell below the 115,000 USD mark – the lowest since early July. Although this price range is considered quite significant, the latest on-chain data suggests that Bitcoin's bullish cycle may not be over yet.

Distribution Wave from Long-Term Investors

According to a post on August 1 by analyst Joao Wedson, the holding cycle of the Long-Term Holders (LTH) group seems to be coming to an end.

Although the market is still excited thanks to Bitcoin ETFs, on-chain data has indicated a clear shift: long-term investors are starting to offload – and in large volumes.

Wedson stated that about 50% of the BTC held in ETFs has been sold off by the LTH group. However, he still predicts that Bitcoin's bull market will last at least another 2 months, while the bullish cycle of altcoins may continue for up to 3 months.

4 Important On-Chain Indicators

To reinforce the assessment, Wedson has presented 4 main on-chain indicators:

  1. Coin Days Destroyed (CDD) – Terminal Adjusted Version

    This indicator measures the amount of BTC that has been 'asleep' for a long time and is now starting to move. Over the past 2 years, there have been significant movements of old BTC, creating 3 warning signals coinciding with local peaks.

  2. Reserve Risk Indicator

    Measures the level of confidence of LTH relative to the current price. This indicator has entered the warning zone, clearly reflecting an increase in selling and BTC transfer activity.

  3. Spent Output Profit Ratio (SOPR) Trend Signal

    Measures whether BTC is being moved at a profit or loss. Recently, SOPR has signaled bearish, indicating that profit-taking is increasing in the market.

  4. Bitcoin Cycle Market Top Prediction – Max Intersect SMA Model

    This is the model that Wedson assesses as the most accurate for determining the macro peak of Bitcoin.

    Currently, this indicator not yet signals a price drop. According to the analysis, when the blue line on the chart hits the mark of 69,000 USD then the market is likely to reach the cycle peak.

Not the Time to Panic

Although many indicators have begun to flash warnings, Wedson believes there is still no evidence confirming that the market has reached its final peak. Historical cycles also show that the current phase still has room for growth, even though the level of volatility and selling pressure from LTH is increasing.

At the time of writing, Bitcoin is trading around 113,052 USD, down 1.2% in the past 24 hours. The analyst advises investors to be cautious, not to panic, and closely monitor on-chain indicators to identify high-risk points in this cycle.