IGNITION
streamoors
Injective
NEAR Protocol
Starknet
Quantus
Bittensor
Key Insights:
- Bitcoin retail demand rebounds after weeks of decline, historically signaling potential recovery.
- Analysts see extreme bearish sentiment as a possible turning point if key support levels hold.
- Short-term holders face losses, with SOPR at a key level that may trigger further selling.
Bitcoin (BTC)price trend has turned bearish after briefly surpassing $100,000 last Friday. The cryptocurrency had rebounded from a low of $93,500 earlier in the week, gaining upward momentum.
However, its rally lost steam following the Bybit hack, which heightened uncertainty across the market. Over the weekend, BTC maintained relative stability at nearly $96,500.
However, it started declining by Monday despite a substantial investment from Strategy. By Tuesday morning, the asset plummeted below $88,000 on Bitstamp, marking its lowest since November 15.
Bitcoin Faces Continued Rejection at $90,000
Bitcoin struggled to regain lost ground, encountering resistance at $90,000. At the same time, it attempted to stabilize above $88,000.
The market mood remained low, and the asset has not regained earlier support levels. Meanwhile, on-chain data from CryptoQuant showed that retail investor demand is reviving.
The 30-day demand change has returned to neutral territory near 0%. That was a notable recovery from a previous decline of approximately -21%, a level last seen in 2021.
This shift suggested renewed retail interest in BTC after weeks of declining participation. Historically, recovering retail demand has often preceded short-term price increases.
In July 2024, the demand change reached -19% before starting to recover. Bitcoin took three months to respond with an upward movement at that time. If similar patterns hold, a potential price reaction may require additional time.
Key Levels for Bitcoin’s Next Move
Market analysts are also closely monitoring BTC’s next moves amid bearish conditions.According to an analysis by Michaël van de Poppe, Bitcoin must absorb market liquidity before making a decisive move.
He identified $83,000 to $87,000 as a possible ultimate bottom before an expected rotation to the upside.
The market is currently in a very negative situation. Moving ahead, this suggested a possible turning moment.
Bitcoin’s next move will depend on whether it holds above the identified support range or faces further downside pressure. Investors are paying close attention to this range as a potential inflection point for price recovery.
Short-Term Holder Profitability at a Critical Point
According to Glassnode data, the spent output profit ratio (SOPR) of short-term holders was close to the 1.0 break-even. In terms of history, breaking above this level is a bullish signal, whereas rejection brings additional selling pressure.
The last time BTC crossed the 1.0 STH-SOPR level was in early January. Then, a rally fizzled and faded, demonstrating short-term holders had little confidence. As the metric tests this level again, traders test its ability to hold on to the upside.
Glassnode has also analyzed short-term holders’ SOPR Multiple, which tracks profitability trends. This metric is negative for now, which means that recent traders have been losing.
As a result, holders losing money are still vulnerable to additional decline. This is because they might keep selling to make small gains.
If Bitcoin does not break through, it may set the stage for another round of selling. This would comply with the bearish outlook.
Nonetheless, if this threshold is successfully exceeded, it could contribute to an increase in profitability. Hence, traders seeking a change of direction will be relieved.
Disclaimer
In this article, the views and opinions stated by the author or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.
