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- CryptoQuant contributor MAC.D said the seven-day moving average of Bitcoin short-term holder SOPR (STH SOPR) surged to about 1.03, returning to a level that previously preceded short-term corrections.
- MAC.D said Bitcoin underwent short-term pullbacks in earlier bullish phases when STH SOPR reached about 1.03, and that investors should again keep the risk of an overheating-driven correction in mind.
- MAC.D said that rather than chasing Bitcoin at current prices, investors may be better off waiting until STH SOPR falls back below 1, and especially below 0.99, which could offer a more attractive buying opportunity.
Forecast Trend Report by Period
Bitcoin may be nearing a short-term correction as short-term holders increasingly lock in profits, according to a CryptoQuant analysis.
In a report published Aug. 29, CryptoQuant contributor MAC.D wrote that the seven-day moving average of Bitcoin’s short-term holder SOPR, or STH SOPR, has surged to about 1.03. That puts the indicator back at a level that has previously preceded short-term pullbacks.
The short-term holder SOPR measures whether investors who held Bitcoin for a relatively brief period were realizing profits or losses when they moved their coins. A reading above 1 means short-term holders are, on average, moving Bitcoin at a profit, while a reading below 1 indicates they are selling at a loss.
MAC.D viewed the move toward 1.03 as a sign of overheating. In earlier bullish phases, Bitcoin underwent short-term corrections when the short-term holder SOPR reached about 1.03. With the gauge nearing a similar level again, investors should keep the risk of a pullback driven by overheating in mind.
As of 6:40 p.m., Bitcoin was trading at $77,704, down 2.13% from a day earlier.
Source: en.bloomingbit.io