Bitcoin sellers in ‘disbelief’ or BTC price wouldn’t still be at $41K — Analyst

A small number of old hands choose to cover all their bases as BTC/USD clinches a July close above $41,000.

Bitcoin sellers in 'disbelief' or BTC price wouldn't still be at $41K — Analyst

Bitcoin (BTC) closed July above $41,000 in a “bullish engulfing” candle that dramatically upends its previous downtrend.

In a tweet on Aug. 1, investor and entrepreneur Alistair Milne joined many celebrating a classic return to form for BTC price action.

Bitcoin refuses to flip bearish

After seeing three straight monthly red candles in a row, BTC/USD held onto late gains to post a monthly close that few had anticipated.

Despite the dip to $29,000, bears failed to stay in the driving seat as July drew to a close as resistance levels fell and sentiment improved. 

“Bullish engulfing on the monthly chart for Bitcoin,” Milne summarized. 

A bullish engulfing pattern is a chart pattern that forms when a small red candle is followed by a large green candle, i.e. July, the body of which completely covers or engulfs the body of the previous candle (June).

Bitcoin sellers in 'disbelief' or BTC price wouldn't still be at $41K — Analyst

BTC/USD 1-month candle chart (Bitstamp). Source: TradingView

The move up — and its staying power — have been so surprising that even seasoned hodlers appear confused about what to do next.

On-chain data shows that some long-term holders (LTHs) are in fact selling as BTC/USD rises, something that analyst Lex Moskovski believes corresponds to the “disbelief” stage of a classic market cycle.

Moskovski highlighted the long-term holder spent output profit ratio indicator (LTH-SOPR), which this weekend hit its lowest levels in 2021.

SOPR looks at the value of coins moved in a particular time period to get an impression of profitability of coins being sold. A downtrend towards the neutral 1 value, host Glassnode explains, suggests that profitability among the coins in question is low.

“Some long-term bitcoin holders are selling into this bounce with minimal profit as indicated by LTH-SOPR hitting this year’s low for two days straight,” Moskovski commented.

Stock-to-flow, while currently demanding a Bitcoin price of nearly $100,000, remains valid, with PlanB giving a minimum August close requirement of $47,000.

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