Key Points
- Bitcoin traders’ profit margins have dropped to nearly zero, potentially easing selling pressure.
- Bitcoin’s realized price for short-term holders has acted as a support during bull markets, currently at approximately $60,000.
Bitcoin (BTC) traders may experience some relief from the recent selling pressure as their profit margins have hit nearly zero.
This observation was made by Julio Moreno, head of research at on-chain analytics platform CryptoQuant, who suggested a potential shift in Bitcoin’s price downside.
Bitcoin Traders at Breakeven Point
The past week has seen a drop in Bitcoin’s price, causing a setback for crypto traders. However, a significant reset could be underway.
Data from CryptoQuant indicates that traders have returned to the breakeven point on exchange holdings at $60,000.
According to Moreno, “Bitcoin selling pressure from traders may be declining as unrealized profit margins are basically zero now.”
An included chart displayed the profit/loss for short-term holders (STHs) — entities owning Bitcoin for 155 days or less.
These speculators have essentially run out of profitable trades, suggesting that selling may now decrease to avoid realizing losses.
Moreno further noted that the traders’ realized price, currently at around $60,000, has served as a support for prices during a bull market.
Bitcoin Price Shows Tentative Bounce
On April 18, Bitcoin saw a relief bounce, reaching $64,182 on Bitstamp.
Rekt Capital, a popular trader and analyst, noted on the day, “This is now an -18% deep pullback that has lasted 10 days thus far…this is very close to bargain-buying territory based on pullbacks in this cycle (up to -23% deep at most).”
However, he also mentioned that this is one of the shortest retracements in this cycle, which usually lasts 2-3 weeks and at most up to two months.
Another trader, Skew, suggested that more evidence of spot demand was needed for confidence in a full-fledged recovery.