SOPR Shows Bitcoin Holders Continue To Sell At A Loss, Similar To May-June 2021
11 Janvier 2022 - 8:00PM
NEWSBTC
The on-chain indicator SOPR suggests that Bitcoin holders have
continued to sell at a loss for a while now. This behavior is
similar to what was seen during the May-June 2021 mini-bear period.
Bitcoin Investors Have Continued To Dump At A Loss For A Month Now
As pointed out by an analyst in a CryptoQuant post, the BTC SOPR
shows that holders are currently selling at a loss. The “Spent
Output Profit Ratio” (or SOPR in short) is an indicator that tells
us whether coins moved on a given day were sold at a profit or a
loss. The metric measures so by looking at each coin on the chain
and checking what the price the coin was last moved at. After that,
the indicator calculates the ratio between this price and the
current price. When the value of the indicator is above one, it
means that holders are currently selling, on an average, at a
profit. On the other hand, when the SOPR has values less than one,
it implies investors are moving their Bitcoin at a loss overall.
Finally, there is the case when the value of the indicator is
exactly equal to one. During such a period, the market is breaking
even on BTC sales. Related Reading | Is The Bitcoin Hashrate
Recovering From Kazakhstan’s Crisis? Fear Abides Now, here is a
chart that shows the trend in the value of the Bitcoin SOPR over
the past year: Looks like the value of the indicator has stayed
below one recently | Source: CryptoQuant As you can see in the
above graph, the Bitcoin SOPR currently has a value less than one,
which means holders are selling at a loss. Related Reading
| Bitcoin Open Interest Continues To Rise, Short Squeeze
Incoming? Such a trend has been there for a month now. A similar
situation was there after the May 2021 crash where the indicator
stayed below one for a prolonged period of time. It’s possible that
the current trend of low SOPR values will continue for a while,
just like back then. The period around May-June was marked by a
mini-bear market, and so if the trend does repeat, a similar bear
environment could follow in the near future. BTC Price Yesterday,
Bitcoin’s price briefly declined below the $40k mark, but since
then has jumped back up. At the time of writing, the price of the
coin floats around $41.7k, down 10% in the last seven days. Over
the past month, the crypto has lost 13% in value. The below chart
shows the trend in the price of BTC over the last five days. BTC's
price has continued to move sideways above $40k in the last few
days | Source: BTCUSD on TradingView Featured image from
Unsplash.com, charts from TradingView.com, CryptoQuant.com
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