Bitcoin has seen a sharp pullback of over 10% since hitting its all-time high of approximately $109,355 on January 20, a peak that coincided with Donald Trump’s presidential inauguration. Despite this retracement, on-chain data suggests that Bitcoin's next bullish surge may be just around the corner, with strong signs pointing toward a potential price target of $116,000.

Long-Term Holders Strengthen Bitcoin’s Foundation

A key driver behind Bitcoin’s resilient price action is the growing demand from long-term investors. According to on-chain analytics firm CryptoQuant, Bitcoin’s “Permanent Holder Demand” has been surging in recent months. This metric tracks the accumulation patterns of investors who typically hold BTC for the long haul rather than engaging in frequent trading.

Historically, spikes in permanent holder demand have often led to periods of intense buying, followed by subsequent waves of selling. However, the current cycle appears to be breaking from past trends. Unlike previous bull runs where aggressive accumulation quickly transitioned into profit-taking, today’s long-term holders are maintaining their positions despite Bitcoin’s recent pullback.

CryptoQuant’s data reveals that accumulator addresses, which primarily belong to investors with a history of holding rather than selling, have significantly increased their Bitcoin reserves. Even amid February’s correction, the demand has remained strong—an indication that conviction among permanent holders remains intact.

Institutional Interest and Trump’s Bitcoin Stance Fuel Optimism

A significant factor underpinning Bitcoin’s sustained momentum is its increasing adoption among institutional investors. The expansion of Bitcoin exchange-traded funds (ETFs), growing corporate treasuries, and broader government interest in digital assets are all contributing to Bitcoin’s long-term bullish outlook.

Adding to this, speculation around Trump’s potential strategic positioning on Bitcoin has further fueled market confidence. If policies favoring Bitcoin adoption emerge under his administration, they could serve as a major catalyst for price appreciation.

Bitcoin’s Path to $116,000: A Technical Perspective

From a technical standpoint, Bitcoin appears poised for a breakout. The cryptocurrency has been consolidating within a symmetrical triangle pattern—a formation that typically precedes a sharp move in either direction.

According to market analyst Titan of Crypto, a breakout above the triangle’s upper resistance level could propel Bitcoin toward $116,000. The projected upside target is derived from measuring the maximum height of the triangle and applying it to the potential breakout point.

Additionally, analyst DOM has identified an unprecedented three-day streak of extreme Doji candles on Bitcoin’s daily chart. These candle formations indicate a period of market indecision, which often precedes a strong directional move. A similar pattern was observed after the FTX collapse in November 2022, which preceded a 620% recovery rally.

“This signals maximum indecision and a large move impending,” DOM noted.

Short-Term Volatility vs. Long-Term Growth

While many analysts see Bitcoin trending toward six-figure price levels, some caution that short-term volatility remains a factor. Investment research firm Bravo Research suggests that a potential dip to $80,000 could present an attractive “buy the dip” opportunity before Bitcoin resumes its upward trajectory.

Meanwhile, Grayscale’s head of research, Zach Pandl, remains optimistic about Bitcoin reaching new all-time highs in early 2025, citing supportive macroeconomic conditions and favorable policy developments as key tailwinds.

Final Thoughts

Bitcoin’s current price action, supported by strong on-chain fundamentals and institutional interest, paints a compelling case for a continued rally. With long-term holders demonstrating unwavering confidence and technical indicators signaling an impending breakout, the path to $116,000 remains a strong possibility.

However, as with all investments, risks remain. Traders and investors should conduct their own due diligence before making any financial decisions.

This article does not contain investment advice. Every trading move involves risk, and readers should perform their own research before making financial decisions.