Bitcoin’s SOPR indicator had a complete calm and turned negative for the first time in five months. This means that, according to the data shared by the Glassnode team, the SOPR indicator has gone negative, which means that on average investors are moving BTC at a loss. Below is a full description of the Glassnode team and a graph showing the decline in SOPR.
The daily #Bitcoin Output Profit Rate Spent (SOPR) saw a complete reset and turned negative for the first time in five months – investors were on average moving BTC at a slight loss, suggesting that profit is decreasing.
Latest state of the SOPR indicator for Bitcoin (BTC)
SOPR, or Output Spent Rate of Profit, “represents the rate of profit of cryptocurrencies carried on the chain, measured by the variation between the purchase price and the selling price”. A SOPR value greater than 1 means that investors are selling with profit. When the SOPR drops below 1, as in Bitcoin right now, investors are selling at a loss.
The team at Bloqport saw the recent drop in SOPR as a clue that Bitcoin has bottomed, at least in the short term. According to Bloqport, the last time such a reset occurred when Bitcoin went from $ 33,400 to $ 57,400. In addition, funding rates have also decreased, providing the ideal environment for another leg for Bitcoin.
Crypto fear and greed index dropped to the last seen levels at the end of January
In addition to the resting SOPR, the Crypto Fear and Greed index dropped to 55 after hitting 90 for the better part of February. It was seen that Bitcoin fell to $ 30,000 at the end of January to 55 index values. The $ 30,000 local low determined Bitcoin’s publishing rate of $ 58,389 – the Binance price – which was its all-time high on February 21.
Therefore, there is a good chance of a local bottom for Bitcoin (BTC). However, Bitcoin has one final bearish hurdle for February in the form of a weekly and monthly close just hours away. This incident could provide additional selling pressure that could eventually break Bitcoin’s support of $ 44K and send it to the $ 42k support zone.