Bitcoin Set For Critical Price Resistance Encounter – Analyst

[Bitcoin]

Bitcoin Set For Critical Price Resistance Encounter - Analyst

The price of Bitcoin has continued to maintain an impressive recovery trajectory following an earlier dip in the week, which saw the asset trade below the $50,000 price mark. The crypto market leader was greatly affected by a widespread decline in the global financial markets, losing over 16% of its market value, due to fears of a potential recession in the US, among other factors. However, as Bitcoin now hovers around $60,000, market experts and analysts have continued to roll out several conditions needed for the premier cryptocurrency to sustain this current positive performance.

Bitcoin To Meet Critical Short-Term Holders SOPR Resistance 

In a Quicktake post on Cryptoquant, an analyst with the username tugbachain shared an insight into the Short Term Holder Spent Output Profit Ratio (STH SOPR) of the Bitcoin market. 

For context, the STH SOPR is a market metric that indicates whether holders are selling their assets at a loss or profit. It is used to measure profitability outputs by providing information on the profit or loss status of short-term investors. The STH SOPR usually tracks assets held for a period less than 155, with a value less than 1 indicating short-term holders would be selling their assets at a loss. While an STH SOPR of 1 states that these investors will break even on their sales. 

Interestingly, tugbachain reports that the STH SOPR of Bitcoin is currently above 1, meaning that short-term holders are currently in profit. However, the analyst warns that BTC approaches a strong resistance at the 1.03 SOPR region, at which they predict the investors may soon start taking profit which could lead to an intense selling activity. 

As expected, this would exert downward pressure on BTC's price. Albeit, in the presence of the right market conditions such as high buying activity, tugbachain predicts the crypto market leader could overcome this resistance and maintain its present upward trajectory. 

BTC Price Overview

At the time of writing, Bitcoin continues to trade at $60,639 with a 1.01% gain in the last day. However, the token's daily trading volume is down by 4.35% and is valued at $38.2 billion.

According to historical price data, the premier cryptocurrency could encounter major resistance at the $67,000 – $70,000 price region if it breaks upward from its current consolidation state. However, if Bitcoin breaks downward, its next viable support level lies at the $55,000 price zone.

Featured image from Barron’s, chart from Tradingview

Source: Bitcoin Set For Critical Price Resistance Encounter - Analyst