Bitcoin Hits New Highs, On-Chain Data Shows More Upside Ahead

Bitcoin has continued its incredible run of form in 2023, reaching a new high of $26,562, according to data by Glassnode. The surge in prices has been driven by several factors, including institutional investment, rising demand from retail investors, and a growing interest in cryptocurrencies as a hedge against inflation.

Glassnode’s data highlights several key metrics that provide insights into Bitcoin’s current momentum. The 200 Week Simple Moving Average (200W-SMA) provides a tool for capturing the baseline momentum of a classic four-year Bitcoin cycle.

Glassnode provides technical pricing models

The 365 Day Simple Moving Average (365D-SMA) offers a long-standing baseline for high-timeframe market momentum. Meanwhile, the Long-Term Holder Realized Price reflects the average on-chain acquisition price for coins held outside exchange reserves, which have not moved within the last 155 days.

Glassnode reports on Cost Basis Cohorts

At the time of writing, the 200W-SMA was at $25,277, and the 365D-SMA was at $24,448. The Long-Term Holder Realized Price was at $21,958. These metrics suggest that Bitcoin is currently in a strong position, with significant upside potential.

On-Chain Data Indicates Bitcoin Has More Room to Grow with Spiking Fees to Reward Ratio

According to data by CryptoQuant, the fees to reward ratio also indicate that there is more upside ahead. This on-chain data shows that the fees to reward ratio has spiked, reaching 0.05 as the highest peak of 2023. This structure likely indicates that there is further upside ahead, with spot advancing towards a current “fair price” of $42,657.

The upward trend in the fees to reward ratio suggests that there is further potential for price increases | Source: CryptoQuant

The fair price heavily correlates with an earlier 2019 model, which forecasted Bitcoin reaching $46,092 this year. The shift from accumulation to distribution cycles can also be predicted by fees to reward on-chain data, which tends to spike before each distribution cycle. This phenomenon occurred in 2019 and 2020, and the recent data suggests that it is happening again.

In conclusion, Bitcoin’s remarkable run of form looks set to continue, with the cryptocurrency likely to experience further price increases in the coming months. The on-chain data provided by Glassnode and CryptoQuant suggests that Bitcoin is currently in a strong position, with significant upside potential.

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