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Bitcoin Must Clear This Critical Cost Basis Level For Continued Upside, Analyst Says

In a recent CryptoQuant Quicktake post, contributor Crazzyblockk highlighted key Bitcoin (BTC) cost basis zones that the leading cryptocurrency must clear – or avoid breaking below – to sustain its bullish momentum.

Analyst Highlights Key Bitcoin Cost Basis Zones

Bitcoin is beginning to show signs of newfound strength, with the top digital asset surging nearly 3.5% over the past week and trading in the high $80,000 range at the time of writing. BTC’s rise amid the global equity market downturn has reignited discussions about the cryptocurrency’s potential to ‘decouple’ from traditional markets.

In a recent Quicktake post, CryptoQuant contributor Crazzyblockk outlined Bitcoin’s various cost basis zones and realized price cohorts to identify key resistance and support levels.

The analyst noted that short-term holders – those who have held BTC for less than 155 days – currently have their realized price, or average cost, sitting at the $91,500 resistance level. Crazzyblockk added that this group tends to be the most price-sensitive.

On the other hand, the cost basis for new holders – those who have held the digital asset for one to three months – currently has its strongest support level around $83,700. The analyst pointed out that this level represents the cost basis of recent market participants, who often lead short-term trend changes.

To clarify, cost basis zones are price levels where a significant amount of BTC was last moved or acquired. A potential breakout above the short-term holders’ realized price would suggest new bullish momentum, as these holders would be back in profit and less likely to sell their holdings.

Conversely, a break below the new holders’ cost basis support level could signal potential downside movement, as recent buyers might begin incurring losses and be forced to capitulate.

Notably, each cost basis line highlighted in the chart below is calculated based on the realized price of Unspent Transaction Outputs (UTXOs) held within a specific age band. Similarly, realized price is determined by dividing the total value of all UTXOs by the number of coins.

utxo

Are Investors Expecting Further Upside?

Recent on-chain analysis suggests that BTC holders may be anticipating further upside. Short-term holders appear to be holding onto their BTC despite being in a loss position.

Additionally, crypto exchange net flow data hints that a BTC price rally may be imminent. Some analysts are also drawing parallels to gold’s recent historic price action and predicting that ‘digital gold’ may soon experience similar momentum.

That said, Bitcoin futures index sentiment is pointing toward rising pessimism surrounding BTC, driven by macroeconomic uncertainty. As of press time, BTC is trading at $88,759, up 1.7% in the last 24 hours.

bitcoin


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