Ever since Bitcoin (BTC) dipped below $100,000 on January 7, it has been exhibiting significant fluctuations as it attempts to recover. With investors treading carefully, CryptoQuant, a market data tracker, suggests that a potential “buy the dip” moment might present itself for traders to consider.
Hopes for Bitcoin (BTC) Price Amid SOPR Signal
Based on CryptoQuant’s Analyst MACD’s perspective, it appears that when short-term investors feel discomfort, more favorable buying chances arise. He pointed out that as Bitcoin’s price decreased, negative social media posts about it spiked significantly. Despite the current market correction, he suggested that this signals a shift towards bearish sentiments in the market.
According to MAC.D and data from CryptoQuant, the Spent Output Profit Ratio (SOPR) has dropped to 0.987. This indicates that short-term Bitcoin holders are currently selling their coins at a loss.
Short-term SOPR below 1, a good time for accumulation
From my perspective as an analyst, as short-term investors endure greater losses, it frequently opens up favorable chances for me to amass assets.
Further details
— CryptoQuant.com (@cryptoquant_com) January 10, 2025
Based on past patterns, the Moving Average Convergence Divergence (MACD) indicated that markets typically recover when short-term investors are unloading their shares. In other words, it’s a good opportunity to invest more, or as they say, “purchase during a downturn.
Has Bitcoin Hit Cycle Top?
According to the analyst from CryptoQuant, various cycle markers such as MVRV, NUPL, Puell Multiple, and the current short-term investor ratio (currently at 60%) suggest that Bitcoin may not have yet reached its peak in this market cycle.
Over the past 24 hours, a drop in the cryptocurrency market led Bitcoin’s price to reach a low of $91,220.84. Currently, Bitcoin is being traded for $95,726, representing an increase of 3.16% over the same period. Although there was an initial decline, the MAC.D indicator suggests that this selloff does not mark the end of the bullish trend.
The analyst suggested that shrewd investors could potentially benefit by buying Bitcoin at reduced prices if short-term investors persist in selling it. In essence, he advised against selling Bitcoin right now, stating that it could be an extremely poor choice.
More Volatility Ahead of Trump’s Inauguration
The value of Bitcoin tends to be unpredictable and can fluctuate significantly, even in response to broader economic events. Recently, it was announced that the U.S. Department of Justice has been authorized to sell around $6 billion worth of Bitcoin that was confiscated from the Silk Road marketplace.
In reaction to the latest announcement, the market experienced a significant drop. Nevertheless, influential figures within the industry such as Matt Hougan, CIO of Bitwise, have expressed confidence that the market will eventually purchase Bitcoin if the U.S. government decides to sell it off. However, despite these positive statements, the coin’s value has yet to rebound.
As anticipation grows about how the upcoming Donald Trump administration will handle the industry, we may see a rise in market turbulence over the next few days.
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2025-01-10 21:22