Short-Term Bitcoin Holders Are Capitulating — Bullish or Bearish Signal?

The Bitcoin market is currently at a crossroads that could make or mar its price trajectory. A certain cohort of investors is panic-selling, and their activities could either trigger a bounce or even further decline in BTC’s price. On-chain data analyzed by CryptoQuant revealed that Bitcoin short-term holders (STH) are ￰0￱ means they are now realizing losses, and such a dynamic signals panic selling among this cohort of ￰1￱ Are Panic-Selling According to a tweet thread, investors have moved more than 30,000 BTC to crypto exchanges at a ￰2￱ usually move their assets to exchanges to sell, while outflows from these trading platforms indicate an intention to ￰3￱ states that the BTC holdings of short-term investors are not only underwater, but they have also entered a capitulation ￰4￱ comes as BTC hovers around the STH Realized Price, which is the average on-chain cost ￰5￱ from CoinMarketCap showed bitcoin changing hands at around $112,900 at the time of ￰6￱ it was above $113,000, more than $3.39 billion in assets were being sold under distress.

Notably, short-term holders are not the only cohort of investors panic-selling; whales are also in ￰7￱ whales have incurred approximately $26.3 million in losses, while the newer ones have realized up to $184.6 ￰8￱ data indicates that several groups of investors are currently de-risking their holdings, and, unfortunately, CryptoQuant believes this is a negative sign for short-term ￰9￱ BTC Rise or Fall From Here? With short-term holders in capitulation mode, the STH Spent Output Profit Ratio (SOPR) has fallen sharply below ￰10￱ the other hand, the STH Market Value to Realized Value (MVRV) metric is at ￰11￱ MVRV’s current level indicates that the average short-term holder is at breakeven, while the SOPR, falling below 1, suggests that many of them are selling below their cost ￰12￱ say both metrics indicate that a wave of top buyers from bitcoin’s recent rally is panic-selling.

Nevertheless, bitcoin’s current price level could lead to either a recovery or a deeper ￰13￱ asset is trading around the STH Realized Price, which is typically a key support level during volatile ￰14￱ this level holds, BTC could bounce; however, if it breaks, a stronger wave of capitulation may follow.