Is The Bitcoin Bottom In? Here’s What SOPR Data Says

Bitcoin has continued its rally breaking above $42k today, making many wonder whether $33k was the bottom. Here’s what the SOPR data says about it. Bitcoin Short-Term Holder SOPR Starts Turning Green Again As explained by an analyst in a CryptoQuant post, the current BTC SOPR pattern may look similar to that around the bottom formation back in July of last year. The “Spent Output Profit Ratio” (or SOPR in short) is an on-chain indicator that tells us whether investors are currently selling at a profit or at a loss. The metric works by checking the history of each coin being sold on the chain to see what price it was last moved at. If the Bitcoin price before was less than the current one, then the coin is considered to have been sold in profit. When the SOPR has values greater than 1, it means holders have been selling at a profit on average. On the other hand, values of the indicator below the threshold imply investors sold at a loss overall during this period. Related Reading | Bitcoin Leverage Ratio Suggests More Decline May Be Coming Naturally, SOPR values exactly equal to one mean the market broke even on average. Now, here is a chart that shows the trend in this Bitcoin indicator over the last year: Looks like the LTH SOPR had a large spike recently | Source: CryptoQuant As you can see above, there are separate graphs for two versions of the Bitcoin SOPR indicator. They are the short-term hold...