2024

Bitcoin

<ul>
 <li><em>A rise in the UTXO in Profit may lead to a price correction.</em></li>
 <li><em>The STH-SOPR signals that it’s time for short-term investors to exit the market.</em></li>
</ul>
<p><a href="https://ambcrypto.com/search/bitcoin" target="_blank" rel="noopener noreferrer nofollow" data-wpel-link="internal">Bitcoin’s [BTC]</a> good show over the last year placed many holders who suffered the bear market of 2022 in profits. However, the current state of the Unspent Transactions Output (UTXO) in Profit might have put BTC’s price in danger, AMBCrypto discovered.</p>
<p>The UTXO in Profit represents the percentage of coins whose value was lower when it was created compared to the current value. On the other hand, UTXOs in Loss are the coins with a lower value than it was when it was created.</p>
<p>For the uninformed, these metrics can be crucial in identifying market <a href="https://ambcrypto.com/bitcoin-rainbow-chart-predicts-the-next-cycle-top-heres-how/" target="_blank" rel="noopener noreferrer nofollow" data-wpel-link="internal">tops</a> and bottoms. At press time, CryptoQuant data <a href="https://cryptoquant.com/asset/btc/chart/network-indicator/utxos-in-profit-percent?window=DAY&amp;sma=0&amp;ema=0&amp;priceScale=log&amp;metricScale=linear&amp;chartStyle=line" target="_blank" rel="noopener noreferrer nofollow" data-wpel-link="external">showed</a> that the UTXO in Profit had increased to 88.63%.</p>
<div id="attachment_361180" style="width: 100%" class="wp-caption aligncenter"><a href="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit-.png" data-wpel-link="internal" rel="noopener noreferrer nofollow"><img aria-describedby="caption-attachment-361180" decoding="async" class="size-full wp-image-361180" src="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit-.png" alt="Bitcoin UTXO in profit chart indicating a possible rise to the market top" width="2560" height="1612" srcset="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit-.png 2560w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit--300x189.png 300w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit--1024x645.png 1024w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit--768x484.png 768w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit--1536x967.png 1536w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-UTXOs-in-Profit--2048x1290.png 2048w" sizes="(max-width: 2560px) 100vw, 2560px"></a>
 <p id="caption-attachment-361180" class="wp-caption-text">Source: CryptoQuant</p>
</div>
<h4><strong>More gains mean more downside</strong></h4>
<p>In past cycles, when the UTXO in Profit hits 95%, the Bitcoin price <a href="https://ambcrypto.com/odds-of-bitcoin-ending-2023-with-a-red-price-chart/" target="_blank" rel="noopener noreferrer nofollow" data-wpel-link="internal">corrects</a>.&nbsp;So, if the coin price rises and places more UTXOs in gains, a notable drawdown might occur. This notion was also corroborated by SimonaD, an on-chain analyst.</p>
<p>SimonaD, who published her analysis on CryptoQuant, noted that:</p>
<blockquote>
 <p>“The last time the market had the metric in a high state indicating over 95% of UTXOs being in profit, it was during the 2021 top bull market. This means that we should pay close attention to this area if it will be touched and crossed in the next period.”</p>
</blockquote>
<p>AMBCrypto then went ahead to check if traders were applying caution. However, the Estimated Leverage Ratio (ELR) indicated otherwise. The ELR shows the average leverage used by traders in the market.</p>
<p>A decreasing ELR suggests traders are taking low-leverage risks. However, at press time, Bitcoin’s ELR had increased. This increase indicates that traders were betting big on the price action.</p>
<div id="attachment_361189" style="width: 100%" class="wp-caption aligncenter"><a href="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4.png" data-wpel-link="internal" rel="noopener noreferrer nofollow"><img aria-describedby="caption-attachment-361189" decoding="async" class="size-full wp-image-361189" src="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4.png" alt="Bitcoin Estimated Leverage Ratio" width="2560" height="1612" srcset="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4.png 2560w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4-300x189.png 300w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4-1024x645.png 1024w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4-768x484.png 768w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4-1536x967.png 1536w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Bitcoin-Estimated-Leverage-Ratio-All-Exchanges-4-2048x1290.png 2048w" sizes="(max-width: 2560px) 100vw, 2560px"></a>
 <p id="caption-attachment-361189" class="wp-caption-text">Source: CryptoQuant</p>
</div>
<h4><strong>Not a good season to buy</strong></h4>
<p>But are these traders taking long or short bets?&nbsp; Well, the Long/Short Ratio reading at the time of writing was 1.08 as of the writing. The data shown by the metric revealed that 50.21% of Bitcoin traders opted to open a position predicting a price increase.</p>
<p>On the other hand, 49.79% of the 24-hour open positions were shorts. A scenario like this <a href="https://www.coinglass.com/LongShortRatio" target="_blank" rel="noopener noreferrer nofollow" data-wpel-link="external">indicates</a> that traders are uncertain about the direction BTC might move. As it stands, BTC may continue to trade sideways, leaving longs and shorts at the risk of liquidation.</p>
<div id="attachment_361193" style="width: 100%" class="wp-caption aligncenter"><a href="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Screenshot-2023-12-29-at-09.57.27.png" data-wpel-link="internal" rel="noopener noreferrer nofollow"><img aria-describedby="caption-attachment-361193" decoding="async" class="size-full wp-image-361193" src="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Screenshot-2023-12-29-at-09.57.27.png" alt="Bitcoin Long/Short Ratio" width="1439" height="368" srcset="https://statics.ambcrypto.com/wp-content/uploads/2023/12/Screenshot-2023-12-29-at-09.57.27.png 1439w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Screenshot-2023-12-29-at-09.57.27-300x77.png 300w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Screenshot-2023-12-29-at-09.57.27-1024x262.png 1024w, https://statics.ambcrypto.com/wp-content/uploads/2023/12/Screenshot-2023-12-29-at-09.57.27-768x196.png 768w" sizes="(max-width: 1439px) 100vw, 1439px"></a>
 <p id="caption-attachment-361193" class="wp-caption-text">Source: Coinglass</p>
</div>
<p>How about Short-Term Holders (STH)? Data evaluated from Glassnode showed that Bitcoin’s STH-SOPR had risen to 1.02.</p>
<p>The STH-SOPR assesses the behavior of short-term investors using the sentiment shown within 155 days. Values of the STH-SOPR below 1 suggest a good entry for buyers.</p>
<p style="text-align: center;">Is your portfolio green? Check the <a href="https://ambcrypto.com/bitcoin-rainbow-chart-predicts-the-next-cycle-top-heres-how/" target="_blank" rel="noopener noreferrer nofollow" data-wpel-link="internal">BTC Profit Calculator</a></p>
<p>So, the Bitcoin STH-SOPR at press time, indicates that it could be time to <a href="https://studio.glassnode.com/metrics?a=BTC&amp;category=&amp;m=indicators.SoprLess155" data-wpel-link="external" target="_blank" rel="noopener noreferrer nofollow">exit</a> the market. For the time being, the Bitcoin price might drop to $42,000.</p>
<p>However, there is widespread anticipation of a 2024 bull market that could send the price to a new All-Time High (ATH).</p>

Another Bitcoin price surge may be bad for BTC prediction- Why?

AMBCrypto

Other articles published on Dec 29, 2023

Is Lowe's Open On New Year's Day?

2024 May Pull More Exploiters Into The Cryptocurrency Market

Changpeng “CZ” Zhao Appeals to Seal Documents for Child’s Privacy

SEC Admits Fault in Crypto Case, Vows to Improve Investigation Practices

Top Ripple Lawyer Says SEC No Longer Scares the Industry

Zcash and Monero on the chopping block for delisting

Join our free newsletter for daily crypto updates!