A historically bullish pattern has printed on Bitcoin’s onchain metric and recent data points to a continuation of the market’s bull run. Bitcoin SOPR just had a ‘golden cross’ signalling further gains in price, says CryptoQuant analyst Axel Adler Jr.
The SOPR tells us if Bitcoin investors are making profits or losses. If the value is less than 1, that means investors are in fact making a profit; if it is greater than 1, they are losing out. A particular version of this metric, referred to as the SOPR Ratio, tracks how short term holders ( STHs ) trade in relation to long term to holders ( LTHs ).
Bitcoin SOPR Ratio Climbs
That being said, 155 days is the cutoff point where further stays in position, in terms of time, make a prospect a LTH. The SOPR Ratio has been climbing recently and makes it seem that STHs are making less money now than LTHs, which is a pattern that has repeated during past bullish times.
LTHs historically made (more) money in bull markets when they bought Bitcoin at lower prices and STHs at higher prices during (and after) bear markets (or vice versa). The surge has propelled the SOPR Ratio to a 1.8, which is thusly above the 90 day moving average!
While LTHs taking profits might be concerning, Adler points out that the danger of Bitcoin’s rally topping out only comes when the ratio hits 7. That means that Bitcoin still has plenty of upside potential and demand could eat through LTH profit taking to extremes before it burns out.
Data from the latest available shows that at the moment of writing, BTC us trading at approximately $68,200, up over 1 percent in the last 24 hours.
