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Analyst Warns: Bitcoin Nearing Profit Zones That Marked Past Market Tops

Analyst Warns: Bitcoin Nearing Profit Zones That Marked Past Market Tops

Author:
Newsbtc
Published:
2025-08-20 02:00:36
9
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Bitcoin's profit-taking zones flash warning signals—again.

History doesn't repeat, but it sure rhymes. Analysts spot familiar patterns as Bitcoin flirts with levels that previously triggered major sell-offs. The same profit-taking behavior that capped previous bull runs now reappears on charts.

Market tops love company. Each cycle brings its own narrative, but trader psychology remains stubbornly consistent. When gains stack too high too fast, even diamond hands get itchy.

Timing the top remains Wall Street's favorite guessing game—right up there with predicting Fed moves and finding honest fund managers.

Tracking Long-Term Holder Signals

According to PelinayPA, the LTH analysis uses several indicators to measure the relationship between Bitcoin’s price and the cost basis of long-term holders.

Profit and loss bands, ranging from 150% to 1,000% above cost basis, help determine when Bitcoin enters zones historically associated with a higher risk of market tops. When BTC approaches the +500% band, it has often coincided with heightened selling activity and eventual cycle peaks.

The analysis also incorporates a Spending Binary Indicator, which reflects the intensity of LTH selling, alongside “High Spending” signals that typically emerge NEAR market tops and “Bottom Alerts” that occur during deep corrections.

Bitcoin long-term holder behaviour analysis

Reviewing past cycles, PelinayPA pointed to 2017 and 2021, where bear market downturns followed heavy long-term holder selling, while the 2022–2023 bottom was marked by multiple loss realization alerts around the $15,000–$20,000 range.

Currently, bitcoin sits within the 150%–350% profit band, leaving potential room for further growth, though the risk of a market top rises as the asset approaches the higher bands. The analyst noted that while green profit-taking bars are visible today, they remain well below the levels observed in earlier cycle peaks.

Bitcoin Market Outlook: Short, Mid, and Long Term

In outlining the potential scenarios, PelinayPA suggested that Bitcoin may remain range-bound in the short term, as controlled profit-taking by long-term holders limits upside momentum.

However, if accumulation and broader demand continue, the price could advance into the $124,000–$178,000 range, corresponding to the higher profit thresholds on the LTH model.

For the mid-term outlook, extending into late 2025, the analyst cautioned that if long-term holder selling intensifies like in 2021, Bitcoin could be nearing a cycle top. In such a scenario, the asset might peak above $150,000 before the next major correction.

Looking ahead to 2026, the absence of new bottom alerts suggests that the market is still within the later stages of the ongoing bull cycle, rather than transitioning into a confirmed bear market.

Bitcoin (BTC) price chart on TradingView

Featured image created with DALL-E, Chart from TradingView

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