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30MA STH-SOPR returns after 4 months over 1

Bitcoin STH-SOPR (EMA-30) has now returned above a level of one for the first time in four months, a sign that could prove bullish for the crypto’s price.

Bitcoin Short-Term Holder SOPR recently broke above 1

As one analyst noted in a CryptoQuant post, BTC STH-SOPR is currently forming a pattern that has historically been bullish for the coin.

The Spent Output Profit Ratio (or SOPR for short) is a bitcoin indicator that tells us whether coins are currently being sold in the market at a profit or a loss.

The metric works by looking at the history of each coin sold and checking if the price it last moved at was lower or higher than the current one.

If the value of this indicator is above one, it means that investors are currently selling their Bitcoin at a profit on average.

Related Reading | Possible Timelines for Bitcoin to Hit $100,000: Why CEOs See Bullish Signs

On the other hand, SOPR values ​​below one imply that total losses are currently being realized in the BTC market.

A modified version of this indicator only considers those investors who held their coins for less than 155 days before selling them. This group of investors is known as Short-Term Holders (STH).

Now here is a chart showing the Bitcoin STH-SOPR (EMA-30) trend over the past few years:

It looks like the value of the metric recently went above one | Source: CryptoQuant

As you can see in the chart above, Bitcoin STH-SOPR (EMA-30) seems to have followed a pattern over the past five years.

It looks like the indicator has always had a value less than one during declining periods. While bullish trends have been occurring, the metric had a value greater than one.

Recently, STH-SOPR broke above 1 again after staying below the threshold for almost four months since December 2021.

Related Reading | Data shows Bitcoin investors are afraid to take risks as leverage remains low

If the pattern from earlier holds true now, then this breakout could indicate that Bitcoin will soon recover towards at least a local top.

However, such an upward trend cannot last for too long. There are two regions on the chart where the metric broke above 1 and the price picked up a bit before the bearish trend resumed and the STH-SOPR returned to loss levels.

BTC price

At the time of writing, the price of Bitcoin is hovering around $46.1k, down 2% over the past week. The chart below shows the recent evolution of the coin’s value.

Bitcoin price chart

BTC price seems to have been moving sideways for the past few days | Source: BTCUSD on TradingView Featured image from Unsplash.com, Charts from TradingView.com, CryptoQuant.com

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