Bitcoin Short-Term Holder SOPR Has Plunged To A Value Of 1
As pointed out by an analyst in a CryptoQuant , the short-term holders are currently selling at their break-even mark. The relevant indicator here is the “Spent Output Profit Ratio” (SOPR), which tells us whether Bitcoin investors are moving their coins at a profit or at a loss right now.
When the value of this metric is greater than 1, it means the average holder in the market is currently selling their coins at a profit. On the other hand, the indicator having values below this threshold suggests the market as a whole is realizing a net amount of loss.In the context of the current topic, the entire market isn’t of interest; only a segment of it: the “short-term holders” (STHs). The STHs include all BTC investors that bought their coins within the last 155 days.
Now, here is a chart that shows the trend in the 14-day moving average (MA) Bitcoin SOPR specifically for these STHs over the last few years:The value of the metric seems to have been going down in recent days | Source:Historically, the Bitcoin STH SOPR has followed a curious pattern. During bullish periods, the indicator has generally stayed above the line where the metric’s value becomes 1. This makes sense, as rallies allow the STHs many profit-taking opportunities, so the majority should be selling at some gains. What’s actually interesting, though, is that whenever the metric has dropped to the 1 line, it has provided support to the price (and has also made the indicator rebound back above it). Examples of this have been marked with the green arrows in the graph.
Recently, the indicator has once again dipped to this crucial level. If the Bitcoin rally is still on right now, then the Bitcoin STH SOPR should observe a rebound here. This has already happened once during this rally, as the price felt support at this level back in March.
If, however, the retest ends up failing, then it may mean that a transition back to a bearish period may have occurred for the cryptocurrency.BTC Price
At the time of writing, Bitcoin is trading around $27,000, down 2% in the last week.Looks like BTC has been moving sideways recently | Source: