Bitcoin Drops 10% Amid Market Volatility, Short-Term Holders Yet to Capitulate

Bitcoin has experienced a significant decline over the past two weeks, dropping by more than 10% and slipping under $75,000. This pullback coincides with broader market volatility stemming from rising geopolitical and economic uncertainty. The ongoing global tariff dispute has placed pressure on equities and digital assets, including Bitcoin.

Amid this price movement, the behavior of short-term holders is crucial in assessing the extent of ongoing market corrections. According to CryptoQuant contributor Yonsei Dent, the current price action reveals important insights into investor behavior. Dent’s analysis focuses on the STH-SOPR (Short-Term Holder Spent Output Profit Ratio), a metric that measures whether coins moved by recent buyers are being sold at a profit or loss.

A reading below 1.0 indicates that holders are realizing losses, a sign often interpreted as capitulation. While Bitcoin’s price has declined significantly, the STH-SOPR has not yet breached extreme levels seen in past correction events. Unlike major capitulation periods in 2024, the current SOPR remains near its mean value, indicating that many short-term holders are not yet exiting their positions en masse.

The absence of widespread capitulation raises questions about the potential for further downside. Dent warns that if selling pressure among short-term holders intensifies, the market could experience another wave of losses. For now, all eyes remain on the $78,000 support level, which may act as a key test for whether Bitcoin can stabilize or if deeper correction lies ahead. Dent wrote that if short-term holders begin to exit more aggressively, the market could face further downside pressure. In the near term, close attention should be paid to whether the $78,000 support level can hold, as it may serve as a key line in the sand for the current market structure.

Meanwhile, technical analysts’ outlook on BTC is slightly different. According to an analyst known as Merlijn The Trader, BTC is currently in what is termed the “green zone” where it is an ideal opportunity for accumulation. This is where legends bought in 2015, 2019, and 2020. Red is for selling, green is for buying. Don’t overthink it.