Bitcoin Market Strength Could Be More Than It Appears, Research Shows

Over the past two weeks, the world’s leading cryptocurrency has struggled to break definitively above the $116,000 price mark while also testing the $106,000 ￰0￱ Bitcoin consolidates around $110,000, the latest on-chain analysis suggests an exciting outlook despite the recent price ￰1￱ Bitcoin Price Might Soon See Expansion In a QuickTake post on the CryptoQuant platform, XWIN Research Japan, a crypto research institution, explores the possibility of a price reversal in the Bitcoin market, saying the current consolidation might be representative of asset-building ￰2￱ institution’s optimistic conjecture relies on readings obtained from three important on-chain metrics.

Firstly, XWIN Research Japan highlights that there has been a sharp drop in Open Interest across futures exchanges since its peak established in ￰3￱ context, the open interest is the total number of outstanding futures or options contracts that have not been settled or closed. A sharp decline in open interest is usually indicative of events referred to as “leverage wipeouts,” where speculative positions are forced out of the market. Historically, a simultaneous decline in open interest alongside the cryptocurrency’s price has often led to market resets, which typically precede sustainable price rallies as a result of growing spot demand. Furthermore, the education and research institution references the Spent Output Profit Ratio (SOPR) metric, which tracks whether investors are predominantly selling at a profit or ￰4￱ SOPR has reportedly found stability around 1.0, meaning that the majority of Bitcoin traders are trading around their cost ￰5￱ extension, this points out that traders are neither in significant profits nor deep in ￰6￱ to XWIN Research, this is a good sign that points to the end of the previous capitulation phase, and reflects the absorption of short-term holder supply by long-term holder ￰7￱ all of these unfold underneath the surface, XWIN Research also postulates that liquidity might also be accumulating for the benefit of the flagship ￰8￱ reported by the institution, the total amount of the stablecoin ERC-20 in supply has reached an all-time high of approximately $158.8 ￰9￱ crypto research institution speculates that if the market sentiment sees an improvement, as much as $158 billion in ERC-20 might be waiting on the sidelines to contribute upward pressure to Bitcoin’s ￰10￱ Reading: Bitcoin Options Data Shows Rising Caution Beneath Supposedly Calm Market – Details Bitcoin Price Overview At the time of writing, Bitcoin is worth about $109,918, with data from CoinMarketCap revealing a slight growth of 0.22% over the past day.