Bitcoin Adjusted SOPR Shows Market At Pivotal Junction — What’s Next?

Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing How Our News is Made Strict editorial policy that focuses on accuracy, relevance, and impartiality Ad discliamer Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. Over the past week, the Bitcoin market experienced new waves of liquidations with prices dropping to around $81,000 on Thursday. Though the premier cryptocurrency has seen a slight rebound since then, bearish sentiments remain dominant with analysts expecting a potential decline to as low as $56,000 . Amid this recent correction, a developing on-chain situation has reached a boiling point, putting the Bitcoin market at a critical juncture. Related Reading Bitcoin’s Slide To $82K Sets Off A $1.7 Billion Chain Reaction 1 day ago Bitcoin aSOPR Holds Clue To Next Market Phase – Analyst The Adjusted Spent Output Profit Ratio (aSOPR) is an on-chain metric used to measure whether Bitcoin investors are, on average, selling their coins at a profit or at a loss, while filtering out noise from short-term, low-value movements. In usual market trends, each new price peak is accompanied by higher conviction as investors are willing to hold longer, take profits later, and tolerate larger drawdowns because they expect even higher prices. However, during Bitcoin’s ascent from around $40,000 in early 2024 to over $100,000, the aSOPR has shown a different pattern as observed by market analyst MorenoDV. Despite a consistent uptrend resulting in multiple price peaks, Bitcoin aSOPR established a downtrend pattern marked by lower highs and lower lows, thereby creating a puzzling market divergence. Source: CryptoQuant According to MorenoDV, this development suggests that Bitcoin traders were aggressively taking profits with each rally, indicating a lack of long-term market confidence. Considering the descending profit-taking pattern, it can also be inferred that investors were satisfied with smaller and smaller gains, suggesting they were no longer convinced that upside continuation was likely. Related Reading Bitmine Stakes Additional 250,912 Ethereum Worth $745M – 61% Is Now Staked 1 day ago The Present Market Debacle Despite the ongoing divergence, it is still observed that aSOPR respects the general market trend with each high in its descending channel aligning with a local price top, while each retest of the lower boundary coincides with a market bottom. Source: CryptoQuant Presently, the aSOPR is retesting this lower boundary, in a fear-ridden market with over 30% of market supply in a loss. Ideally, MorenoDV explains these are accumulation opportunities, especially in further consideration of the negative aSOPR. However, the analyst warns that a decisive fall below this line could strengthen present bearish sentiments, resulting in an intense market capitulation, as an already fearful set of investors would likely initiate a sell-off. At press time, Bitcoin continues to trade around $83,819, reflecting 0.41% decline in the past day.  Following the recent liquidations, the market leader is now 34% away from its all time high of around $126,100. BTC trading at $84,072 on the daily chart | Source: BTCUSDT chart on Tradingview.com Featured image from Freepik, chart from Tradingview