How to Use Quantitative Strategies to Identify the Best Selling Timing for BTC? CryptoQuant Analysts Provide a Unique Analytical Perspective
Recently, a CryptoQuant analyst provided a quantitative analysis perspective on the timing of buying and selling Bitcoin by studying the spent output profit ratio (SOPR) indicator of short-term holders (STH) of Bitcoin.
The analysis suggests that short-term holders (STH) typically refer to investors who have purchased Bitcoin within the past 155 days. Compared to long-term holders (LTH), who focus more on long-term holding, these investors are more susceptible to market fluctuations, making their behavioral data an important reference for analyzing market trends.
By observing the historical records of each wallet in sell transactions with the SOPR indicator, one can determine whether investors are selling Bitcoin at a profit or a loss. When this indicator is above 1, it indicates that the overall market is in a profitable state; when below 1, it indicates that the market holders are primarily at a loss.
The analysis shows that whenever the short-term holder SOPR indicator enters the green zone (significant losses), it is often a good time to accumulate Bitcoin; while entering the red zone (significant profits) may suggest that the market has entered a profit-taking phase.
However, although the green and red zones of the SOPR indicator can serve as references for market bottoms and tops, they do not perfectly capture every price turning point. Therefore, the analyst suggests that investors should use a strategy of buying or selling in batches when the indicator enters the corresponding zone, rather than making a one-time operation.
Looking back at historical cycles, earlier this year, the short-term holder SOPR indicator fell into the green zone, which corresponded to a market low. As Bitcoin's price recently broke through $104,000, the indicator has risen above 1, but has not yet entered the red zone, indicating that, based on the SOPR data, it is still not the best time to take profits by selling Bitcoin.
Meanwhile, Bitcoin's price has rebounded over 10% in the past week, and market sentiment is gradually warming up. The upcoming market trend is worth continued attention!
How valuable do you think the SOPR indicator is in actual investment decisions? Would you consider the parameters of quantitative tools like SOPR as a reference for your investment strategy? Feel free to share your thoughts!
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