Latest Bitcoin Top Is Different From 2021 Peak, Analyst Explains Why

A recent analysis has highlighted the key differences between the recent high in Bitcoin and the peak observed during the 2021 bull run. The primary distinction lies in the trend of liquidations in the derivatives market. The chart provided by the analyst demonstrates that during this year’s rally, short holders faced significant losses, leading to many contracts being liquidated. In contrast, during the 2021 peak, long positions were being liquidated as Bitcoin reached its top. This suggests that investors during the current rally were less greedy and bet against the continuation of the run. However, another indicator, Coin Days Destroyed (CDD), shows similarities between the current trend and previous peaks. High levels of CDD indicate significant movement of dormant coins in the market, which typically aligns with Bitcoin’s price peaking. Although this correlation held true for some previous tops, it’s important to note that the 2021 peak took months to form after the CDD metric peaked. As of now, Bitcoin is trading around $62,200, experiencing a 5% increase over the past week.