- Be ahead of Bitcoin’s SOPR short-term holders fell below 1 after last week’s price drop.
- This meant that these investors have been trading at a loss ever since.
Bitcoins [BTC] Short-term holders continued to distribute their assets at a loss, while the spent earnings ratio for this cohort of investors was falling downwards at the time of writing.
Read Bitcoin [BTC] Price forecast 2023-2024
Short-Term Holder Spent Output Profit Ratio (STH-SOPR) is a metric used to measure the profitability of short-term holders of a particular crypto asset. It generally provides insight into whether investors holding a particular asset for three to six months are in a profitable or unprofitable position.
If the STH-SOPR is above 1, it indicates that short-term holders are selling their coins at a profit on average. Conversely, if the STH-SOPR is below 1, it indicates that these holders are selling at a loss.
In response to the impact of last week’s deleveraging on BTC short-term holders: pseudonymous CryptoQuant analyst On the chain noted that the STH-SOPR fell to 0.96.
According to Onchained, this STH-SOPR level was similar to a previous price correction in March 2023, when the price of BTC fell from $25,000 to $19,800, and the STH-SOPR also fell to 0.96.
This value was 0.98 at the time of printing, according to data obtained from CryptoQuant. With BTC exchanging hands above $26,000, “short-term holders are still selling at a loss, but the losses are less.”
Source: CryptoQuant
Record lows in BTC distribution
An assessment of BTC price movements on a daily chart found that key momentum indicators have fallen to the lows last seen in 2020.
Bitcoin daily RSI is the most oversold since the March 2020 covid crash pic.twitter.com/MPUfmQagcu
— Will Clemente (@WClementeIII) August 22, 2023
BTC’s Relative Strength Index (RSI) stood at 20.90, while the money flow had dropped to 6.79 at the time of writing. The positions of these indicators confirmed the high volume of BTC selloffs among daily traders, most of which occurred after last week’s sudden price drop.
BTC bears have been in control of the market since August 17. A look at the Directional Movement Index (DMI) showed that the positive directional index (green) remained at 10.32, below the negative directional index (red), which was 35.86.
In situations like this, the downward movements are more pronounced than the upward movements, indicating a drop in price.
BTC’s Awesome Oscillator also indicates decreasing buying pressure and has been marked by downward red histogram bars since last week.
Source: BTC/USDT on trade view
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Despite the increased coin distribution among daily traders, players in the futures market have taken a different approach. After going short on the leading coin for a few days, funding rates on crypto exchanges have turned positive.
This revealed that investors have started taking trading positions with bets in support of a rally in the price of BTC.
Source: Coinglass