Currently, nearly 90% of Bitcoin’s circulating supply is in profit, indicating overbought conditions. BTC price could fall further to $60,000.
Story Highlights
Bitcoin (BTC), the world’s largest cryptocurrency, continues to face some selling pressure and has pulled back below $63,000, losing another 2% in the past 24 hours. On-chain data shows that Bitcoin investors are losing patience as buy calls are declining while sell calls are rising.
Bitcoin Sell Call Options Jump
Bitcoin's price plunge to below $63,000 has sparked concern among cryptocurrency traders as social media has been flooded with fewer buy calls and more sell recommendations. Such signs of fear, uncertainty and doubt (FUD) spreading to the market often signal a greater likelihood of a recovery.
Currently, to measure the percentage of cryptocurrency supply that is profitable, we analyze the purchase price of each unit versus its current market value. This method allows us to determine the percentage of supply that is currently profitable.
Historically, if the percentage of supply that is in profit is high, it usually means that most holders purchased the asset at relatively low prices. Especially during bull markets, these profit ratios tend to rise sharply, such as the cryptocurrency price surge we observed between October 2023 and March 2024, which often coincides with indicators of overbought conditions.
This week, BTC volatility has dropped significantly, from 70% to 50% now. Looking ahead, we can see potential positives coming to light as Hong Kong’s Bitcoin (BTC) and Ethereum (ETH) spot exchange-traded funds (ETFs) are scheduled to begin trading next week. This development is of great interest as it promises to become an important channel for institutional capital inflows into Asia.
Post-halving correction underway?
One week after the Bitcoin halving event, the price of Bitcoin has been under some degree of selling pressure. Research shows that different groups of Bitcoin holders have adopted different strategies. "Crypto whales" who hold 1,000 to 10,000 BTC usually start selling in advance when the price rises to ensure profits while avoiding large market fluctuations. In contrast, small investors who hold 0.01 to 10 BTC often maintain or even increase their holdings, even after the market reaches its highs.
Medium-sized holders who manage 100 to 1,000 BTC show flexible buying and selling strategies, and are often able to anticipate market adjustments. These holders react quickly to market changes, demonstrating a complex and thoughtful investment strategy.
