Bitcoin: Is Bitcoin About to Plummet? What Does the On-Chain Data Say?
Increased on-chain realized losses suggest another BTC rally is imminent.
Cycle Detector historical data shows the coin is not in a bear phase.
If the current cycle remains in a bullish phase, Bitcoin [BTC] The bottom is near. AskFX derived this conclusion from the Short Term Holder (STH SOPR).
SOPR is short for Spent Output Ratio. This indicator provides insight into the actual profits made by all coins traded on-chain. This time the focus is more on the short-term perspective.
How much are the losses for Bitcoin?
STH SOPR greater than 1 means that the BTC price was higher than the BTC buy value when sold. This shows a large amount of realized profits on-chain.
If the metric falls below 1, it means that sell prices are higher than the weighted buy value. This shows realized losses on the blockchain. CryptoQuant reports that Bitcoin’s STH SOPR is now at 0.98.
In the past, this has meant that Bitcoin is approaching its bottom. In September 2023, the same thing happened, as shown in the image above.
Bitcoin was trading at $26,253 at the time. The SOPR also fell to a similar range. In November of the same year, the coin reached $35,441.
The pattern often repeats itself in other bull cycles, such as 2021 and 2018. If this is the case, the price of Bitcoin could increase by 34.99% in two months.
BTC was trading at $57,154 at the time of publication. According to this calculation, the price of BTC could be around $77,100 in September.
If this becomes a reality, BTC could reach a new high this quarter.
It is still important to check if the cycle is in a bullish phase, no matter how positive the outlook is.
It’s still not your time, bears!
When Bitcoin fell to $54,274, people predicted a bear market. Opinions do not confirm such things. AskFX wanted to know about the situation firsthand, so we turned to Glassnode.
To do this, we examined the Bitcoin Cycle Change Detector. This detector detects transitions between a bull and bear market. This detector can also determine if a market was in a bearish phase and has now switched to a bullish phase.
The hue of the chart turns red when the market turns bearish. Market conditions in November 2022 made this clear. However, at the time of writing, this was not the case.
The transition from a bull to a bear cycle will not happen unless the total Bitcoins in circulation reach a gain of almost 100%. It is possible that BTC has bottomed out.
The coin could reach a higher value before the end of the quarter – possibly between $76,000 and an extremely optimistic price of over $80,000.
This prediction will be dashed if the selling pressure of the last few weeks continues.
