Bitcoin Prints a Trusted Bottom Indicator as Newer Holders Exit the Market

Bitcoin may be entering the type of capitulation phase that has reliably marked short-term market bottoms over the past two years, with analysts pointing to improving macro conditions and a critical price threshold at $88,000.

New data from CryptoQuant shows the Short-Term Holder SOPR — a metric that tracks whether recent buyers are selling at a profit or a loss — dropped to 0.94 earlier this week while BTC traded in the $80,000–$90,000 band.
A reading below 1.0 signals that newer holders are selling at a loss, a pattern that has historically aligned with local lows and subsequent rebound phases.

This type of flush-out has been seen repeatedly: early 2023, late 2023, mid-2024, and again now. In each case, short-term holders realized losses during sharp declines, only for stronger hands to absorb supply and stabilize price action shortly after.

CryptoQuant noted that the latest SOPR dip reflects “loss realization” rather than a breakdown in long-term market structure, suggesting the selling pressure stems from leveraged unwinds rather than fundamental weakness.

Market behavior supports this interpretation. Bitcoin’s drop below $90,000 unfolded primarily during U.S. trading hours, while equities were climbing on softer consumer data and rising expectations of a Federal Reserve rate cut in December. That rebound in risk appetite briefly lifted BTC above $89,000 before it slipped back toward $87,000 as U.S. markets closed.

FxPro analyst Alex Kuptsikevich said crypto’s recent rebound is still closely shadowing U.S. equity strength, with BTC struggling to generate upside momentum on its own. He characterized the recent uptick as “a counter-trend rally within a seven-week downtrend,” adding that a sustained move above $88,000 is needed to confirm a local bottom.

Other indicators point to a market attempting to reset. Derivatives open interest has been significantly reduced, showing that leveraged longs have largely been flushed out. Funding rates have normalized, and perpetual swap markets are hovering near flat after a week of persistent negative funding — historically a precursor to short-term price recoveries.

With Fed officials sounding increasingly supportive of potential easing and global risk sentiment improving, the stabilization in SOPR may be the first signal that BTC’s sellers are running out of momentum.