KEY POINTS

  • 1Y+ HODL Wave chart saw an increase in the number of Bitcoin investors who have not moved their coins in the last 365 days
  • The chart suggests that when the price of Bitcoin increases, the 1Y+ 'hodlers' decreases, indicating they have sold their coins
  • Despite an increase in Bitcoin's price this week, the 1Y+ hodlers continue to increase, suggesting that price upside is still on the cards for the world's first cryptocurrency

Analysts expect Bitcoin to rise further as the HODL Wave chart, which indicates the number of unmoved Bitcoins in the last 12 months, has surged to all-time high levels this week.

The HODL Wave chart is created by financial service company Unchained Capital to record the number of Bitcoin addresses with Bitcoins that have not moved in a specific time frame. A newer chart, called 1Y+ HODL Wave, specifically looks at the Bitcoin addresses with Bitcoins that have not moved in the past 365 days and then correlates it with the logarithmic price of Bitcoin. "Hodling" is the term referring to keeping and storing Bitcoins instead of using, trading, or selling them.

Based on the chart, it can be inferred that anytime Bitcoin’s price goes up, the owners of the Bitcoin address with Bitcoins move their tokens out. It indicates that when Bitcoin price goes up, they move their coins to possibly sell it for USD or USDT. 

At the same time, when Bitcoin price goes down, the 1Y+ "hodlers" tend to not move their coins, indicating that they are seeking to sell at a higher price. 

Bitcoin was created in 2008 Bitcoin was created in 2008 Photo: AFP / JACK GUEZ

The only time when there were more 1Y+ hodlers was from January to March 2016 when Bitcoin was around $300 to $400, says Bitcoin advocate Alistair Milne. 

Bitcoin is currently worth $11,125, trading around that level in the last five days after it plowed past $10,500 on July 27. Despite increasing Bitcoin prices this week, the 1Y+ HODL Wave suggests more potential upside in the benchmark cryptocurrency's value.

While not exactly definite, it can be inferred that many 1Y+ wallet owners bought around the same time Friday, July 31, as last year. At that time also, Bitcoin was hovering around $11,000 and increased to around $12,000 by August.

Now, all eyes are in the weekly and monthly closing prices. The target is to close above $11,560 at weekly and above $10,730 for monthly. The next few hours will be critical for Bitcoin’s monthly close.

However, analysts expect more upside in the coming days as bullish predictions are flooding Twitter. One key indicator is Ethereum's price action, which rallied earlier than Bitcoin last week. While the benchmark cryptocurrency is seen struggling to sustain $11,000, Ethereum has managed to hit $340 today. “ETH is leading Bitcoin again. If so I think Bitcoin will see $12k soon,” analyst Josh Rager posted on Twitter