On-Chain data shows that a Bitcoin indicator is forming a pattern that could indicate an upcoming bull market for the asset.
In a recent post on X, analyst Charles Edwards shared a chart highlighting a potential pattern forming in the BTC indicator called “HODLer Growth Rate.”
This indicator tracks the 1-year growth of Bitcoin investors’ holdings who have kept their coins dormant (untouched) in their wallets for at least two years.
In general, an investor who holds their coins for at least six months is considered a “long-term holder” (LTH). LTHs are determined market participants who typically don’t sell quickly regardless of what’s happening in the rest of the market.
Statistically speaking, the longer an investor holds their coins, the less likely they are to eventually sell them. Therefore, the holders who make it to the 2-year mark, which is the segment of interest in the current discussion, are among the most determined investors within these LTHs.
Hence, it may be worth keeping an eye on everything these holders are doing as it can have an impact on the rest of the market. Of course, it’s not likely that these holders have a short-term influence (as they usually remain silent), but in the long run, the effects of their behavior could become visible.
Here is a chart showing the trend of Bitcoin HODLer Growth Rate for this specific segment of LTHs over the past decade.[Insert chart image]
It appears that the value of the metric has started to move sideways in recent days, according to a source.
As Charles hinted in the above chart, there seems to be a specific pattern that the growth rate of Bitcoin HODLers has followed across cycles.
It appears that the value of the indicator remains positive during bear markets and is in an upward trend, indicating that these investors are accumulating their holdings in such phases. And as prices continue to decline, they only increase the pace of this accumulation.
As the bear market approaches its end and a transition to a bull market takes place, the value of the metric decreases, meaning that these investors are still accumulating their holdings, albeit at a constant pace rather than an increasing one. Then, when the bull market begins, these Bitcoin HODLers gradually cease accumulation completely and instead start participating in distribution.
The analyst notes that the Bitcoin HODLer Growth Rate now appears to have completed the phase of rapid expansion during the bear market and is starting to stabilize sideways.
If we can rely on the pattern of previous cycles, this could mean that the Bitcoin market is now in the midst of a transition to the next bull market.
Bitcoin remains stuck in a range, as its price is still around the $26,100 mark.[Insert price chart]
BTC has been consolidating since the crash, according to a source.