According to at least one on-chain indicator, Bitcoin’s price is approaching a local bottom. This comes after the cryptocurrency has been stuck in a tight range of roughly $30K for a long time.
The price of bitcoin is currently roughly 57% below its all-time high set in November of last year.
The bottom may be approaching, according to one technical indicator, the long-term output profit ratio (LTH-SOPR).
The LTH SOPR is determined by dividing the dollar value of spent outputs at spent time by the dollar value of spent outputs at generated time. To put it another way, the realized value is divided by the original value.
According to CryptoQuant’s data, the current 7-day SMA LTH SOPR is 0.72, implying that some long-term investors may be selling at a loss.
The last time the LTH-SOPR plummeted to this levels was in March 2020, after the COVID crash. However, its value decreased to 0.53 at the time, indicating that there may be more suffering ahead.
This “doesn’t indicate the bottom is in,” according to the CryptoQuant analyst, “but it’s worth watching this statistic.”
The cryptocurrency fear and greed index, on the other hand, is still in “severe dread” area.
The indicator is intended to assess current market mood, and it indicates that investors are extremely frightened right now.
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