Bitcoin Market Profitability Hits ‘Complete Reset’ — What’s Next For Price?

Overview

The Bitcoin market has recently experienced significant bearish pressure, with the price struggling below a key psychological level. However, on-chain data indicates that the cryptocurrency may be approaching a potential upward trend.

Current Market Situation

On December 5, Bitcoin faced renewed bearish pressure, causing its price to remain below the critical 90,000 level throughout the weekend. As of December 6, analysts from CryptoOnchain suggested that a local bottom may be forming for Bitcoin’s price. They observed a reduction in selling pressure, particularly among long-term holders, signaling a potential shift in market dynamics.

Analyzing the Spent Output Profit Ratio (SOPR)

A key metric in this analysis is the Spent Output Profit Ratio (SOPR), which assesses the profitability of spent outputs for both long-term and short-term holders. The SOPR metric serves as an indicator of whether market participants are selling their assets at a profit or a loss.

• SOPR Greater than 1: Indicates that investors are selling at a profit.
• SOPR Less than 1: Suggests that participants are selling while incurring losses.

Currently, the Bitcoin SOPR has dropped to 1.35, marking its lowest point since early 2024. This decline suggests a complete reset in market profitability, particularly as Bitcoin’s price fell below the 90,000 threshold.

CryptoOnchain noted that the wave of profit-taking by long-term holders seems to be diminishing, as market fatigue among bearish traders becomes more pronounced. Historically, such a low SOPR indicates that a local bottom is forming, which may lead to a potential price rebound.

Bitcoin Price Overview

As of the latest data, Bitcoin’s price is approximately 89,500, showing no significant changes in the past 24 hours. The cryptocurrency has experienced a nearly 2% decline over the past week. Additionally, it is down about 5% year-to-date and approximately 30% from its all-time high. This situation suggests that Bitcoin may conclude the year in a negative position unless market momentum shifts unexpectedly.

Impact on the Crypto Market

• The declining SOPR indicates a potential reset in market profitability, which could lead to a price rebound for Bitcoin.
• A reduction in selling pressure from long-term holders may stabilize the market and pave the way for future upward movements.
• The current price struggle below the 90,000 level highlights the psychological barriers affecting trader sentiment.
• Analysts are closely monitoring market conditions for signs of a potential rally, especially after a prolonged selling phase.
• The overall market remains cautious, with Bitcoin’s current price trajectory influencing broader cryptocurrency trends.