Why the $65,000 Level is Crucial for Bitcoin Price

The Bitcoin (BTC) price has been rising relentlessly for days. The digital currency is profiting from the enthusiasm caused by the major interest rate cut by the US central bank.

Bitcoin’s rally has now lifted the price to the realized price of short-term holders, suggesting there may be room for further upside. If so, Bitcoin could confirm its first upward trend in over half a year.

Bitcoin back in bull market environment

CryptoQuant analyst Avocado_onchain noted yesterday that Bitcoin’s price had reached its so-called ‘short-term holder realized price’ – around $62,000. This metric has historically acted as strong support/resistance for Bitcoin, sparking large gains every time the price has tested it.

The short-term holders are the wallet addresses that have held Bitcoins for less than 155 days. The realized price is simply the average price at which these coins have moved across the network.

So it gives an indication of the average price that short-term holders have paid for their Bitcoin. Avocado_onchain calls it an ”important on-chain metric to watch” because it ”can determine the future direction of Bitcoin’s price”.

When the realized price of short-term holders acts as resistance – and Bitcoin fails to break above it – the price is seen as being in a bearish trend. ”A recent example of this is when Bitcoin reached $73K but failed to break through the average purchase price of 1-3 month short-term holders, resulting in a bearish move,” the analyst said.

When realized price acts as support, breaking through the metric or a retest in the past has always caused a big price rally. Now, this is of course no guarantee that this will happen again, but it is certainly an indication that bullish momentum has been regained.

BTC price nears key point

As you could read in the Bitcoin news this morning, Bitcoin has shot up to a price of $64,000. The crucial target of $65,000 is now within reach.

If BTC manages to break above $65,000, it would have made its first higher high in over six months. This means that the downtrend that has been going on since March can finally be put behind us. However, the bulls will still need a little push.