A major move for Bitcoin (BTC) is likely approaching as price moves through a rare ultra-low period of volatility, according to a closely followed on-chain analyst.
Pseudonymous analyst Checkmate tells his 93,700 followers on the social media platform X that BTC has only moved 8.3% up or down in the last month, a rare occurrence for the flagship cryptocurrency.
The situation suggests two possible outcomes, according to the analyst.
“Bitcoin very rarely goes this quiet.
The 30-day price range is separated by just 8.3%.
There are two outcomes:
1) Bitcoin remains a stablecoin for a new paradigm
2) Volatility is just over the horizon.”
Source: Checkmate/X
Checkmate also shares a chart with the short-term holder sell-side risk ratio indicator, which aims to predict whether short-term holders are about to unload their coins and potentially trigger a correction.
According to the analyst, the indicator’s current status is suggesting that sell-side risk is low, which based on the chart, has often coincided with price bottoms or rallies.
“The Bitcoin sell-side risk ratio is one of my favorite metrics to help navigate volatility.
When it trades lower (as today), it means all the profit and loss that was going to be taken, has been.
The market needs to move somewhere to motivate the next round of spending.”
Source: Checkmate/X
The analyst also points out Bitcoin’s short-term holder spent output profit ratio (STH-SOPR) metric, which tracks the profit or loss levels of all moved BTC during a given period for the short-term holder cohort.
Checkmate says that recently, Bitcoin’s STH-SOPR dipped below the “1” level briefly before rebounding. According to the analyst, the quick bounce is “good” for the BTC market.
“Some of you bought Bitcoin high, and are now selling it low…and it shows.
Watch for STH-SOPR for a change in market character:
– Sharp slices below 1.0 and then recovery = Good
– Sustained breaks below 1.0 = Not Good
– Finding resistance at 1.0 = Seatbelts On”
Source: Checkmate/X
At time of writing, Bitcoin is trading at $66,544.
Generated Image: Midjourney
