Bitcoin SOPR Suggests Current Market Activity Resembles Early Bull Run Behavior

Despite Bitcoin reaching new highs, the BTC SOPR data may suggest current market activity resembles that of an early bull run.
Bitcoin SOPR Shows Profit Taking Is Mild Despite New ATH
As per the latest weekly report from Glassnode, the BTC SOPR shows that the current profit taking behavior of the market is mild, even though the crypto just reached new highs.
The Spent Output Profit Ratio (or the SOPR in short) is a Bitcoin indicator that highlights whether holders as a whole are currently selling at a profit or not. 
The metric’s value is calculated by taking the ratio between the value of coins at the time holders bought them, and the price at which they sold them. Simply put, it’s price sold divided by price paid.
When the indicator has values greater than one, it means the coins that were moved during the specific time period sold, on an average, at a profit.
Related Reading | 10 Bullish Monthly Bitcoin Price Charts To Start November
On the other hand, SOPR values lower than one would suggest holders sold their Bitcoin at a loss overall during the period. The metric’s value exactly equal to one means the market broke even.
Now, here is a chart that shows the trend in the value of the aSOPR indictor, which is the normal SOPR adjusted to eliminate relay transactions and other noise by not taking into account spent outputs that moved within one hour of creation:

The change in the BTC aSOPR over the course of the entire bull run | Source: Glassnode 
As the above graph shows, the current Bitcoin market looks to be showing mild spending behavior with some profits. 
Interestingly, similar market activity was observed in the couple of months leading up to November 2020. Back then, the bull run had only just started and BTC was yet to make a new all-time high.
This time Bitcoin has already made a new ATH, but spending behavior hasn’t shifted to sustained profit taking that was seen throughout the early part of this year. 
Related Reading | Ethereum Supply Shock Deepens: Exchange Reserves Decline 18% In 5 Months
The trend may show that investors are not willing to sell at current levels as they think the price will appreciate further. 
The report notes that positive aSOPR behavior with upwards or sideways price movement like right now can be constructive as it shows the market can absorb the sell side while also maintaining support levels.

BTC’s price shows a sharp movement up | Source: BTCUSD on TradingView
BTC Price
At the time of writing, Bitcoin’s price floats around $63k, up 2% in the last seven days. The above chart shows the trend in the price of the coin over the last five days.
Featured image from Unsplash.com, charts from TradingView.com, Glassnode.com

Avatar

Related Articles

- Advertisement -

Latest Articles

bitcoin
Bitcoin (BTC) $ 27,245.30
ethereum
Ethereum (ETH) $ 1,906.46
tether
Tether (USDT) $ 1.00
bnb
BNB (BNB) $ 307.45
usd-coin
USD Coin (USDC) $ 1.00
xrp
XRP (XRP) $ 0.525257
staked-ether
Lido Staked Ether (STETH) $ 1,905.09
cardano
Cardano (ADA) $ 0.381154
dogecoin
Dogecoin (DOGE) $ 0.072969
solana
Solana (SOL) $ 21.63
matic-network
Polygon (MATIC) $ 0.904734
tron
TRON (TRX) $ 0.081640
litecoin
Litecoin (LTC) $ 96.30
polkadot
Polkadot (DOT) $ 5.36
binance-usd
Binance USD (BUSD) $ 1.00
shiba-inu
Shiba Inu (SHIB) $ 0.000009
avalanche-2
Avalanche (AVAX) $ 14.76
dai
Dai (DAI) $ 1.00
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 27,263.30
uniswap
Uniswap (UNI) $ 5.12
chainlink
Chainlink (LINK) $ 6.51
leo-token
LEO Token (LEO) $ 3.58
cosmos
Cosmos Hub (ATOM) $ 10.81
okb
OKB (OKB) $ 45.99
monero
Monero (XMR) $ 149.78
ethereum-classic
Ethereum Classic (ETC) $ 18.22
the-open-network
Toncoin (TON) $ 1.74
stellar
Stellar (XLM) $ 0.092466
bitcoin-cash
Bitcoin Cash (BCH) $ 116.52
internet-computer
Internet Computer (ICP) $ 4.84
filecoin
Filecoin (FIL) $ 4.86
lido-dao
Lido DAO (LDO) $ 2.35
true-usd
TrueUSD (TUSD) $ 1.00
aptos
Aptos (APT) $ 9.14
quant-network
Quant (QNT) $ 117.30
hedera-hashgraph
Hedera (HBAR) $ 0.051012
crypto-com-chain
Cronos (CRO) $ 0.060625
arbitrum
Arbitrum (ARB) $ 1.23
near
NEAR Protocol (NEAR) $ 1.65
vechain
VeChain (VET) $ 0.020059
apecoin
ApeCoin (APE) $ 3.17
the-graph
The Graph (GRT) $ 0.129320
algorand
Algorand (ALGO) $ 0.152964
the-sandbox
The Sandbox (SAND) $ 0.578846
eos
EOS (EOS) $ 0.918020
paxos-standard
Pax Dollar (USDP) $ 1.00
frax
Frax (FRAX) $ 1.00
render-token
Render (RNDR) $ 2.73
elrond-erd-2
MultiversX (EGLD) $ 38.77
optimism
Optimism (OP) $ 1.52