Bitcoin climbs back up, but for how long?
Bitcoin has reclaimed price levels above $90,000 after trading below this psychological zone for most of the past two weeks. During this consolidation period, the leading cryptocurrency even plunged to $80,600, marking a deviation of over 10% from this crucial support.
While the current price action appears to indicate a proper recovery, analysis of on-chain metrics reveals a far more nuanced reality. Long-term holders (LTH) are taking advantage of this modest rebound to massively liquidate their positions, creating invisible selling pressure for the average trader who merely observes price charts.
The LTH-STH SOPR ratio hits 2.63: Warning signal for bulls?
On-chain analytics platform Arab Chain recently published a detailed report on CryptoQuant that highlights a significant shift in Bitcoin’s internal market structure. The analysis focuses on the Binance BTC SOPR Ratio (LTH – STH) metric, which compares the profit-taking behavior of long-term holders versus short-term holders.
The ratio recently climbed to 2.63, its highest level since last August. This surge occurs precisely as Bitcoin rebounds toward $90,000, suggesting that LTHs are using this bounce as an exit window. This metric reveals that investors who have held BTC for more than 155 days are selling their holdings with considerable profits, taking advantage of each pump to lighten their positions.
The SOPR (Spent Output Profit Ratio) of long-term holders currently stands at 2.58, which concretely means that these investors are realizing average gains of 158% on their sold positions. Historically, such divergence in the LTH-STH ratio. Particularly when it reaches a multi-month high, generally precedes periods of price correction of varying degrees.
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Silent distribution: STHs selling at a loss while LTHs cash out
The current market imbalance becomes even more striking when examining short-term holder behavior. Their SOPR sits around 0.98, indicating they are currently selling their holdings either at breakeven or even at a loss. This configuration creates a particularly fragile market dynamic where smart money exits with massive profits while new entrants capitulate or exit without gains.
Arab Chain emphasizes that if bearish pressure were to intensify, this divergence could significantly accelerate the decline in Bitcoin’s price. Short-term investors, already in a weak position, could be forced into panic selling if the $88,000 to $90,000 support were to break, creating a cascade of liquidations.
This type of growing gap between LTH and STH behavior has often preceded significant moves in BTC’s market cycle. The analytics firm suggests that the market is likely entering a classic “cash-for-profit” phase. Where major holders are strategically reducing their exposure. A similar dynamic was observed last August, a period that was followed by a notable correction.
Extended distribution phase: Several weeks of volatility ahead
Unlike the brutal and rapid corrections crypto traders are accustomed to, Arab Chain estimates that this profit-taking phase could extend over several weeks. This gradual distribution by LTHs creates an invisible resistance ceiling that could prevent Bitcoin from quickly reclaiming its previous highs, even if short-term price action remains relatively stable.
The market could experience a major price reset rather than a simple passing fluctuation. This outlook is based on the exceptional amplitude of the LTH-STH ratio, which suggests a massive redistribution of wealth from strong hands to new participants, a typical pattern of phase transitions in the Bitcoin cycle.
At the time of writing, Bitcoin is trading around $90,652. However, the liquidation heatmap indicates numerous long liquidities to be swept down to $84,000. It’s worth noting that a loss of $88,000 would indicate a weakening of Bitcoin strength among smart money. In this context, new lows in the coming weeks, down to $76,000, should be considered. Furthermore, numerous shorts are positioned for liquidation at $91,800, a price Bitcoin should reach today or Monday.
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