- According to on-chain analyst, Bitcoin, which is struggling to sustain slight price increases, may be at risk of another downward trend.
- According to the analyst, a profit ratio has been reached in Bitcoin UTXOs, and this ratio has been recorded as 79.53%. However, considering the history, a high UTXO situation may not always be positive for price movement.
- According to Phil’s shared graph, the exchange whale had reached its peak. Therefore, there may be significant market movements causing price corrections.
Bitcoin price faced selling pressure and dropped below $28,500; how can Bitcoin price progress in the coming days?
Bitcoin Price Faces Selling Pressure
According to on-chain analyst, Bitcoin, which is struggling to sustain slight price increases, may be at risk of another downward trend. BTC, often referred to as a leading indicator of the cryptocurrency market, has experienced a series of price fluctuations recently.
The price history of the cryptocurrency has shown a pattern of sharp declines followed by impressive recoveries. However, the possibility of another downward movement raises important questions about the factors at play.
This performance prompts investors to wonder about the next move of the currency, and the analyst believed that Unused Transaction Output (UTXO) could provide some insights. UTXO refers to the amount of cryptocurrency that increases after a successful transaction.
According to the analyst, a profit ratio has been reached in Bitcoin UTXOs, and this ratio has been recorded as 79.53%. However, considering the history, a high UTXO situation may not always be positive for price movement. Explaining this situation, the analyst wrote:
“A high UTXO percentage can often indicate a selling risk in the near future. When it acts as resistance, there is a retreat in price.”
The analyst also believed that the health of Bitcoin could be affected by the current state of the metric. However, this depends on owners’ decisions to sell or hold their assets.
Moving with Loss
In addition to the aforementioned analyst, Phi Deltalytics also stated that Bitcoin could be in a short-term downward trend. Unlike the analyst, Phil used the exchange whale ratio to reach this conclusion.
The exchange whale ratio is the relative magnitude of the first 10 input transactions compared to the total inputs. When this ratio is below 85%, it indicates a bull market, while a metric above 85% indicates a possible mass sell-off. According to the graph shared by Phil, the exchange whale had reached its peak. Therefore, there may be significant market movements causing price corrections.
In another CryptoQuant publication, Phil doubled down on his bearish stance. This time, the Adjusted Spent Output Profit Ratio (aSOPR) was used. As a representation of total profit and loss, aSOPR compares the profit ratio of all market participants.
Values of aSOPR greater than 1 indicate that coins are moving with profit. When the metric is exactly 1, it indicates that prices are at the cost point. And finally, when aSOPR is less than 1, it indicates that the market is selling at a loss.
At the time of Phil’s publication, aSOPR was less than 1. Therefore, he concluded:
“Recent sideways movements have turned both aSOPR and short-term SOPR below 1. The market is not convinced by the bull.”
