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Is Bitcoin’s price action at risk? Here’s why traders should watch out!
Bitcoin’s short-term price outlook is facing a potential challenge following the decline of the Short-Term Holder Spent Output Profit Ratio (STH SOPR). A falling STH SOPR often indicates that short-term holders are either taking profits or realizing losses, which can be a sign of slowdown in bullish momentum.
This shift in market behavior could lead to a phase of consolidation or, in a more negative scenario, a deeper price correction. As the market reacts, investors are closely monitoring how this development may influence Bitcoin’s near-term trajectory.
At the time of writing, Bitcoin’s STH SOPR was hovering around 1, reflecting a balance between profits and losses for short-term holders. This marks a shift from the recent euphoria during the $108k rally, with neutral SOPR levels often signaling consolidation or correction phases.
Additionally, the redistribution of Bitcoin between Long-Term and Short-Term Holders is underway, a typical occurrence at local market tops. If the STH SOPR continues to decline, we may see selling pressure intensify, especially around realized price levels near $85k and $99k.
Bitcoin’s supply dynamics and market behavior are also playing a pivotal role in shaping its price trends. Spikes in STH supply have been linked to market tops, contributing to heightened volatility. The recent neutral stance of the STH SOPR pointed to selling pressure at breakeven levels â contributing to investor hesitancy.
Resistance around the $85kâ$99k range further suggested that consolidation or cautious accumulation may be likely, with potential for greater short-term volatility.
Source: ambcrypto.com
