Home CryptoMarket Bitcoin metric warns of $21K profit-taking as decade-old BTC wakes up

Bitcoin metric warns of $21K profit-taking as decade-old BTC wakes up

by CryptoFan
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After sleeping for up to 10 years, Bitcoin (BTC) wakes up this week as Bitcoin (BTC) price action hits a six-week high.

Data from on-chain analytics firm Glassnode show The oldest ‘dormant’ bitcoin is back in circulation.

BTC trend out of hibernation

Hodler is changing course after a year-long bear market as BTC/USD shows some recovery in late October.

Number of bitcoins previously sitting in wallets for 7-10 years but not active again, according to Glassnode Record high price for the first time in a month October 29th.

In fact, this is the latest in a string of highs, the previous high being seen on October 1st.

The last active BTC supply on the chart 7-10 years ago. Source: Glassnode/Twitter

other numbers evident Profit Unspent Transaction Output (UTXO) hit a one-month high of over 73% on Oct. 28, aiming to surpass levels from September.

Glassnode Shows Bitcoin Moves Happen Quickly, Bringing Gains Rather Than Losses.

Bitcoin unspent transaction output (UTXO) on profit chart. Source: Glassnode/Twitter

SOPR spike across key range

The data supports the theory that there is a growing desire to engage in profit taking even among Bitcoin’s most experienced hodlers at current prices.

Related: Surrender or Take Profit?Bitcoin whale moves his dormant 32K BTC since 2018

Key network indicators show that such profit-taking activity could increase significantly even if the spot price shows only modest growth.

The latest measure of Bitcoin’s Return on Spend Output (SOPR) shows that further price gains will position BTC/USD as a traditional profit-taking country.

SOPR basically shows how much of the BTC supply is being sold in profit or loss. Fluctuating around 1, the ratio tends to be negative in bear markets, and above 1 during an uptrend can indicate an increase in supply, which in turn can affect price performance.

“In a bear market, everyone is selling or waiting to sell at breakeven.” Renato Shirakashi, creator explained In the introduction of the 2019 indicators:

“When the SOPR approaches or exceeds 1, people start selling more and more goods because the breakeven point is reached. As supply increases, prices plummet.”

Bitcoin Spent Output Profit Ratio (SOPR) chart.Source: Glassnode

As reported by Cointelegraph, some on-chain signals suggest the picture is more nuanced.

Binance, the largest exchange by volume, recorded its biggest BTC balance drop ever this week, indicating that users withdrew over 55,000 BTC in a single day.

The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. All investment and trading movements involve risk. You should do your own research when making a decision.