Testing Time For Bitcoin Price, These Indicators Points a Trend Reversal
The post Testing Time For Bitcoin Price, These Indicators Points a Trend Reversal appeared first on Coinpedia – Fintech & Cryptocurreny News Media| Crypto Guide
Recently, the world’s first cryptocurrency, Bitcoin failed to reclaim the $25,000 price level and is maintaining the momentum around the $24,000 area.
In the last seven days, Bitcoin has surged by 6%, whereas it has lost 1% on the daily chart. Hence, this suggests a consolidation period.
At the time of writing, Bitcoin is selling at $24,063 after a fall of 0.37% in the last 24hrs. The flagship currency is always known for making an opposite move to what the expectation is.
However, the two of bitcoin org
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on-chain analysis, Spent Output Profit Ratio (SOPR) and the Realized HODL (RHODL) are pointing towards a trend reversal.
Bitcoin SOPR
Spent Output Profit Ratio (SOPR) is basically an on-chain indicator which suggests whether the market is in profit or loss. If the readings are above one (black line) it says that the market is in profit and if it’s below one the market is in loss.
In Jan 2018, SOPR plunged below one (black circle) indicating that this was the end for a bullish trend. Then the bottom was hit after 11 months in December. Again the SOPR broke in May 2021 (red circle) and in June it hit 0.928.
At the moment, on August 5th (red arrow) made an attempt to move above one, but it failed. Hence, the indicator is all set to make another attempt to break. If SOPR manages to break above one, it confirms that the bottom has occurred.
RHODL Ratio
Next, the RHODL ratio is a metric formed by the ratio of one-week and the 1-2yrs of HODL Wave bands. Marking that is above 50,000 (highlighted in red) suggests that an important part of BTC supply is held by short-term holders
At present, the RHODL ratio is above 350 positioned at 360 and this is marked as oversold. It is important to note that on August 11, the ratio had slipped below 350 before moving upwards.
It’s been a record that whenever there is a downward and upward marking near 350, there is a market bottom. If the markings hold on then it reveals that the ratio has managed to bounce and this confirms a bottom.
