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Bitcoin Holders Aggressively Accumulate BTC, Good News For Rally?

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On-chain data shows that Bitcoin investors have shifted towards aggressive accumulation recently, something that may help sustain the rally longer.

Bitcoin Accumulation Trend Score Has Tended Towards 1 Recently

According to data from the on-chain analytics firm Glassnode, there is a structural similarity forming between the current and 2018-2019 BTC cycles. The indicator of interest here is the “accumulation trend score,” which tells us whether Bitcoin investors have been accumulating or distributing over the past month.

This metric’s value represents not only the number of coins that the holders are selling or buying but also the wallet sizes of the entities that are taking part in the accumulation or distribution trends.

When the accumulation trend score has a value near the 1 mark, it means the large entities (or a huge number of small investors) are accumulating the asset currently.

On the other hand, the indicator having values close to the 0 levels suggests holders are distributing (or alternatively, just not accumulating much) at the moment.

Now, here is a chart that shows the trend in the Bitcoin accumulation trend score over the last few years:

The value of the metric seems to have been close to the one mark recently | Source: Glassnode on Twitter

As displayed in the above graph, the Bitcoin accumulation trend score had assumed yellow/orange shades during the first couple of months of the latest rally. This means that the metric had values close to 0 then, implying a large amount of distribution was taking place from the large entities.

This suggests that the investors may not have thought this rally would go on for too long so they were harvesting their profits while they still could. The trend, however, has changed during the latest stretch of the rally, which has taken the price close to the $30,000 level.

Interestingly, the trend that the current rally is following seems to be similar to what was seen duri

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Author: Hououin Kyouma

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