Bitfinex, one of the world’s leading cryptocurrency exchanges, has released a report indicating that Bitcoin (BTC) has been sold in profit since its initial break above $30,000, suggesting early signs of a bull market.
The report highlights two key on-chain metrics, the Spent Output Profit Ratio (SOPR) and Net Unrealised Profit and Loss (NUPL), which suggest that Bitcoin has entered the early stages of a bull market.
Bitcoin Sold In Profit
The report notes that BTC’s price broke above the crucial $29,500 mark for the second time this year on June 21st and had been bracketing in the range between this level and the $31,000 level since then.
This range has always acted as a pivotal point in deciding the trend for the crypto market and, as such, is a major psychological level. The SOPR has been above one for about two weeks now since the BTC price broke above the crucial $29,500 level, indicating that people are, on average, selling their Bitcoin at a profit.
The report also breaks down the events following the break above the $29,500 level and the subsequent range of the market between that and the $31,000 level from an order flow perspective.
It notes that there is a high probability that the move away from the current range for Bitcoin is decisive since a retest of the range after a move up or down would mean it is likely to act as a crucial rebound zone when and if the price returns to it.
However, the report warns that the next move out of the current range will be decisive and violent, which is unusual for the BTC price of late.
BTC Dominates Digital Asset Flows
According to the latest Coin Shares report, investors continue to pour money into digital asset investment products, with a second week of inflows totaling $125 million. The last two weeks have seen inflows of $334 million, representing almost 1% of total assets under management (AuM).
Bitcoin remains the primary focus of investors, accounting for $123 million of inflows, or 98% of all digital asset flows. Recent price appreciation has seen AuM rise to $37 billion, matching the average AuM for 2022 and reaching the highest point since early June.
Despite recent bullishness for Bitcoin, short-Bitcoin investment products saw their 10th week of outflows, totaling $0.9 million and representing 59% of AuM. Nevertheless, short-Bitcoin remains the second-best performing asset in terms of inflows year-to-date, with $60 million.
On the other hand, a selection of altcoins saw minor inflows, with Ethereum leading the way at $2.7 million, followed by Cardano, Polygon, and XRP. Multi-asset and Solana saw minor outflows of $1.8 million and $0.8 million, respectively.
The report suggests that investors remain bullish on Bitcoin, with inflows representing a significant portion of total assets under management. However, the continued outflows of short-Bitcoin investment products indicate some investors are betting against the cryptocurrency’s short-term performance.
BTC has failed to consolidate above the $31,000 mark for two consecutive days. At the time of writing, BTC is trading at $30,900, representing a decline of 0.3% in the last 24 hours.
The failure to consolidate above $31,000 could indicate a lack of buyer interest, potentially leading to further downside pressure on the cryptocurrency. It remains to be seen whether BTC can regain its footing and make another attempt at breaking through this crucial level.
Featured image from Unsplash, chart from TradingView.com