Don’t Get Too Greedy On Bitcoin, Analyst Suggests, Here’s Why

Bitcoin has experienced a significant trend change; the market sentiment has also changed in 2023. Since breaking from consolidation, Bitcoin’s momentum has shifted to the upside, transitioning from a bear market to potentially the early stages of a new bull market.
For the analyst, long-term holders recognize the value of the cryptocurrency and are “price insensitive;” when the market reaches this stage, exchange/broker order books become more illiquid as there are fewer marginal sellers. As prices become more and more attractive, the market becomes saturated with long-term holders, those who no longer intend to sell until prices are substantially highe.
Edwards points out that bitcoin is becoming increasingly illiquid, with an exponential increase in long-term holders, who now represent 49% of the network, a new all-time high.

For Edwards, once a whiff of demand hits an illiquid order book, deeply undervalued assets rocket up in a short-squeezed fashion. The reason is that there are very few active sellers in the market; buyers have no sellers to buy from. This results in bullish momentum as the closest available sellers place orders.