BTC Investors Refuse To Realize Losses While Glassnode Predicts Breakout
Glassnode, one of the crypto space’s top crypto data aggregators, has given out a report on the 25th of January, 2020. This report took notice of the adjusted Spent output Profit Ratio (aSOPR), and has suggested that many an investor will realize losses should Bitcoin decrease in prices.
Bearish Info Bullish In Ongoing Circumstances
Normally, this sort of information is rather bearish, as the metric shows that few traders are sitting on profitable investments. However, Glassnode has a whole other interpretation of this data. According to Glassnode, the SOPR can only go lower should investors start to sell their holdings at a loss.
Glassnode is convinced that such an event won’t happen easily, thanks to the market’s current condition. In fact, the data aggregator stated that this reset is something it’s been waiting for, as this will allow the market to gain some stability and ready itself for the next bull run.
As for what aSOPR is, Glassnode described it as the profit-ratio of various coins, using the price of Bitcoin since it last moved on-chain as a reference. It should be noted, however, that centralized exchanges’ circulations of BTC aren’t counted in the aSOPR metric, since aSOPR itself is an on-chain metric.
Bullish Markets Pushing aSOPR Above 1
Typically speaking, the aSOPR metric oscillates near 1. However, the recent massive levels of bullish sentiments seen throughout these past few months saw it spike above the 1.15 mark, starting at December’s end and going through to January’s first half.
This same metric shows a general rejection of any value below one during bullish market conditions. Simply put, traders are simply too reluctant to sell at a loss, so they don’t.
Glassnode: Time For Another Bull Run
According to Glassnode, the ongoing correction within the Bitcoin market is nearing its end, as is suggested by the aSOPR chart. Looking at the ongoing correction, Bitcoin has seen a 31% correction from its peak to its trough. The asset fell just below $29,000 in value on the 22nd of January, 2020. At the time of writing, however, Bitcoin has gone on to change hands at a price of $31,807.
Back on the 25th of January, Glassnode had reported that 12.6% of the circulating supply of Bitcoin, around 2.3 million BTC, has already moved on-chain. This occurred when Bitcoin was trading above the $30,000 mark, which Glassnode officially flagged as bullish trade activity.
