What Is “Holding Period Analysis” and How Does It Influence Investment Decisions?
Holding period analysis examines how long investors hold onto assets before selling. Long-term holders (LTH) tend to accumulate during market downturns and distribute during bull runs, signaling market confidence. Short-term holders (STH) are more reactive to price swings, often selling during volatility. A rise in LTH supply suggests a strengthening bullish trend, whereas an increase in STH activity may indicate speculative trading. On-chain metrics, such as the Spent Output Age Bands, help track holding patterns, providing insights into market stability and potential trend reversals.