Bitcoin's Market Faces Pressure Amid Rising Losses

According to Cointelegraph, the ongoing correction in Bitcoin (BTC) has resulted in approximately 33% of its total circulating supply being held at a loss, a level not seen since September 2024. While this may seem concerning, historical data suggests that such phases often indicate seller exhaustion rather than a complete market collapse. This concentration of unrealized losses has historically marked pivotal points in previous bullish cycles, typically forming when liquidity stress peaks and most sellers have already acted, allowing the market to structurally reset. Short-term holders are experiencing intensified loss-making activity, with the seven-day short-term holder Spent Output Profit Ratio (SOPR) currently at 0.9904. This metric, which measures whether coins moved onchain were sold at a profit or loss, indicates that most coins are being sold at a loss, reflecting growing pressure from short-term traders. The SOPR’s Z-score, which assesses how current readings deviate from historical norms, is at −1.29, suggesting moderate selling pressure. In comparison, during the August 2024 correction, the indicator fell to 0.9752 with a Z-score of −2.43, marking a deeper phase of capitulation. The market appears to be caught between patience and capitulation. If prices remain under pressure, long-term holders might start taking profits to protect their gains, while newer investors may sell once they recover their costs, potentially limiting rebounds. However, if fear reaches an extreme and selling pressure diminishes, these conditions could help form a durable bottom and reset sentiment for the next accumulation phase. From a momentum perspective, Bitcoin’s market structure seems oversold, yet historical patterns indicate that recovery often follows a period of consolidation rather than an immediate reversal. A significant buildup of short positions in the futures market could also fuel a rebound if prices stabilize soon. Technically, Bitcoin continues to follow the pattern forecast in Cointelegraph’s mid-October analysis, where BTC was projected to retest the $103,500–$98,100 order block, a key demand region. A daily close below $98,100 would invalidate this setup and expose the yearly open near $93,500. While recovery may take time, stable consolidation between $98,000 and $103,000 could lay the groundwork for a gradual rebound by year-end.