We can not deny that the year so far has been pretty solid in comparison to last year but its literally just 10 days. News articles are already flipping out over this 10% but it really does not seem much as we are still in this sub $20k area. But actually this range we are in is pretty significant as a very large amount of volume has historically been traded in this range, in fact the most.
Here we can firstly see the 13% rise in the Supply in Profit metric to this exact pump, bringing back the majority of the supply to profit.
Chart imported from Glassnode
Now to the reason of this big increase of the Supply in Profit while the price increased by just 10%. The Supply in Profit metric is depended on where how much BTC was bought. If at a certain price level a large amount of BTC has been bought throughout its history then this will lead to an accordingly large increase of the metric.
Imported from therationalroot (from 04/01/2023)
And exactly in the current price level of exactly $16.5k to $17.8k, so exactly the price area that we just eclipsed in the past days which now also makes sense on how the Supply in Profit started rising here. The current levels have been one of the strongest support-wise, so the chances of a bottom forming here are pretty good actually but dont get your expectations too high just now.
We are much more likely to gain support at such areas of high historic volume and where the bitcon uspply changed the most hands and with no doubt we are at such levels right now, but bear in mind that this indicator is just as speculative right now as all of on-chain data is.
