Bitcoin (BTC) appears to be on the brink of a significant movement as it navigates through an unusually calm period of volatility, as indicated by a popular on-chain analyst.
Known as Checkmate, this analyst informs his 93,700 followers on the social media platform X that BTC has only experienced an 8.3% increase or decrease in price over the past month, a rare event for the leading cryptocurrency.
This situation presents two potential outcomes, according to the analyst.
“Bitcoin rarely remains this quiet. The 30-day price range shows a mere 8.3% difference. There are two possibilities: 1) Bitcoin maintains stability for a new era 2) Volatility is on the horizon.”
Checkmate also shares a chart featuring the short-term holder sell-side risk ratio indicator, which aims to anticipate whether short-term holders are preparing to sell their coins, potentially triggering a market correction.
Based on the analyst’s assessment, the indicator currently suggests a low sell-side risk, which historically has coincided with price bottoms or upward movements.
“The Bitcoin sell-side risk ratio is a valuable tool for navigating market volatility. When it decreases (as it has today), it indicates that all the potential profit and loss has been realized. The market needs a catalyst to drive the next phase of activity.”
The analyst also highlights Bitcoin’s short-term holder spent output profit ratio (STH-SOPR) metric, which monitors the profit or loss levels of all moved BTC by short-term holders during a specific period.
Checkmate notes that recently, Bitcoin’s STH-SOPR briefly fell below the “1” level before rebounding, which he sees as positive for the BTC market.
“Some investors may have bought Bitcoin at a high price and are now selling at a loss…and it’s evident. Keep an eye on STH-SOPR for a shift in market sentiment: – A quick drop below 1.0 followed by recovery = Positive – Prolonged dips below 1.0 = Negative – Meeting resistance at 1.0 = Caution”
At the time of writing, Bitcoin is trading at $66,544.
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