Bitcoin Surges 28% in October, Setting the Stage for a Potentially Lucrative Month

Recent data from Glassnode has provided some remarkable insights into the market, with Bitcoin showing a substantial 28% increase in October. This surge marks an exciting development, making it the second most profitable month of the year, trailing behind January’s astounding 40% ascent.

One crucial metric that offers an illuminating perspective on the current state of the Bitcoin market is the concept of the “realized price.” The realized price unveils the mean purchase price for all current Bitcoin owners, effectively mitigating the effects of market volatility and providing a more stable view of the cryptocurrency’s value.

A closer examination of the yearly cohorts’ on-chain cost basis reveals some intriguing trends. All cohorts, with the exception of those who began purchasing Bitcoin in 2021, find themselves in a profitable position. The 2021 investor cohort’s position is of particular interest as they seem to be continuing their dollar-cost averaging strategies. However, it’s noteworthy that their realized price has decreased from $50,000 to $35,000 over the span of two years.

Exchange Average Withdrawal Price | Source: Glassnode

This decline in realized price for the 2021 cohort is a critical factor to consider. If Bitcoin’s price were to surpass the $35,000 threshold, it could potentially trigger a round of profit-taking, acting as a short-term resistance and moderating immediate upward price movements. Investors will be keen to watch this level closely in the coming weeks.

In addition to the $35,000 resistance level, the 2023 realized price level has played a significant role in the market this year. Only once did Bitcoin deviate below this level during the SVB collapse in March, but it promptly rebounded above it shortly thereafter, showcasing the resilience of the cryptocurrency.

To provide a more detailed breakdown, the realized prices for various cohorts are as follows:

  • 2017+ ($15,907)
  • 2018+ ($19,352)
  • 2019+ ($22,432)
  • 2020+ ($26,649)
  • 2021+ ($35,053)
  • 2022 ($26,902)
  • 2023 ($26,790)

This data sheds light on how Bitcoin’s value has evolved for different groups of investors over the years. It’s important to note that the earlier cohorts, such as those who got involved in 2017 and 2018, have seen substantial gains compared to their initial investment, while the 2021 cohort appears to be holding strong despite a temporary dip in the realized price.

As we move further into October, the cryptocurrency market is brimming with anticipation. The recent surge in Bitcoin’s price, combined with the insights provided by Glassnode’s data, suggests that this could be a particularly lucrative month for Bitcoin enthusiasts. However, the $35,000 resistance level and the lessons learned from the 2021 cohort’s experience are important factors to keep in mind as the market continues to evolve.

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