As Bitcoin consolidates near its all-time highs, derivatives and spot markets are developing constructively, with further price appreciation being the most likely outcome for the coming week.
Last week marked a historic milestone as Bitcoin reached a new peak. After a brief pullback in late October, BTC traded between $58,208** (low) and **$63,698 (high). Despite dipping below $60K**, Bitcoin rallied **40%** in October—fueled partly by the launch of the ProShares Bitcoin Strategy ETF (**$BITO). This surge represents Bitcoin's strongest monthly gain (40%+) since December 2020. Notably, October's price range ($23,205, including wicks) exceeded Bitcoin's entire trading range from genesis through December 2020.
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Ethereum also outperformed, hitting a new ATH of $4,455**, surpassing its May 12 peak of **$4,362.
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Low Profit-Taking Signals Bullish Sentiment
Modest Selling Pressure
- Adjusted SOPR (aSOPR)—excluding coins held <1 hour—shows mild profit-taking near ATHs, resembling early bull market behavior.
- Positive aSOPR during consolidation suggests absorption of sell pressure without breaching support levels.
Short-Term Holder (STH) Dynamics
- STH Profit/Loss Ratio >1 (green zone): Indicates accumulation near cost basis; holders resist selling at breakeven.
- Ratio <1 (red zone): Signals STH losses, often preceding bearish reversals.
Long-Term Holder (LTH) Resilience
- NUPL (155+ days): LTHs retain 50–75% unrealized profits—a historical pivot point for rallies.
- Current LTH-NUPL mirrors 2013, 2017 patterns, suggesting upward momentum if support holds.
Derivatives Market Cooling Off
Funding Rate Warnings
- High positive funding rates + stagnant/declining prices = long squeezes.
- Recent rate normalization points to healthier leverage conditions.
Liquidation Waves
- $3.5M hourly long liquidations occurred post-ATH breakout (Oct 21–22).
- Slower recent activity hints at trader caution.
Margin Shift to Cash
- Crypto-margined futures dropped from 66% (Spring 2021) to 46% today, reducing volatility compounding.
Bullish Network Fundamentals
RVT Ratio Nears Lows
- Low RVT: High USD-transferred value vs. realized cap = bullish utility signal.
- Current levels match macro uptrend precedents.
Old Coins Reawakening
- Spent Volume Age Bands (1mo+): Surged to >6% daily volume (from <2% in September).
- Rising ASOL (40-day avg) confirms increased old-coin movement.
FAQs
Q1: Why is low profit-taking bullish?
A: It indicates holder conviction—investors await higher prices rather than cashing out prematurely.
Q2: What does rising ASOL mean?
A: Increased spending of older coins often precedes volatility, historically aligning with breakouts.
Q3: How does cash-margined futures help?
A: Reduces cascade risk from crypto collateral devaluation during downturns.
Key Terms
- SOPR: Sell-side profit ratio.
- NUPL: Net unrealized profit/loss.
- RVT: Ratio of transaction volume to realized cap.
Disclaimer: This report does not constitute investment advice. Conduct your own research before making decisions.