Crypto Dan2025-01-15

Aggressive Short-Term Trading is a No-Go; The Upward Cycle is Still Ongoing

Bitcoin has slightly rebounded, reaching near the $97,000 mark. Analyzing the short-term SOPR, we notice a consistent pattern: during correction phases, the metric shifts from the red circles to the green circles. This movement tends to dampen market participants' optimism about a price rally, only for the market to rebound thereafter. The higher the red circle, the more it suggests profit-taking by major whales, which typically leads to deeper or longer correction phases. Currently, compared to March, we see a significantly smaller profit-taking volume, which implies that this correction period is likely to be shorter than the previous one, which lasted for seven months. As the current correction has already extended beyond one month, there is a high likelihood of resuming an upward trend within Q1 2025. However, in the short term, there may still be one or two sharp drops that push SOPR below the yellow dotted line, potentially crushing market participants’ hope for a rally before the market reverses upward. As such, aggressive short-term trades should be approached with caution."