Bitcoin’s price has taken a sharp downturn, crashing below $90,000 after failing to hold key support levels. The decline marks a continued struggle to maintain momentum, pulling BTC further away from the highly anticipated $100K milestone.
One major factor driving the drop is the behavior of short-term holders (STHs), who are showing signs of increased selling pressure as market sentiment shifts.
Short-Term Holders Increase Sell Pressure
The Spent Output Profit Ratio (SOPR) for short-term holders is struggling to reclaim the bullish 1.0 threshold. Staying above this level indicates profitability and confidence among traders. However, its failure to do so suggests rising sell pressure.
If the SOPR remains below 1.0, more short-term holders may liquidate their positions, potentially leading to further losses. Historically, STHs are quick to sell in volatile conditions, accelerating downward trends.
Bitcoin Exchange Outflows Remain Low
Despite the price drop, Bitcoin outflows from exchanges remain relatively low. In the last 24 hours, only 157 BTC worth $14 million left major exchanges. This suggests that while prices are falling, many investors are holding onto their assets instead of panic selling.
This hesitation to sell could indicate a potential market stabilization, as traders wait for signs of a reversal before making further moves.
Bitcoin Faces Key Support at $87K
At the time of writing, Bitcoin is trading at $88,449, its lowest level since November 2024, following an 8% drop in the past 24 hours.
BTC has now lost its downtrend line support, which had held for over a month. The next major support sits at $87,041. If Bitcoin maintains this level, a bounce-back could be possible.
To confirm a recovery, Bitcoin needs to break resistance at $89,800 and push toward $92,005. However, if BTC falls below $87K, the sell-off could intensify, sending prices toward $85K and extending the bearish trend.
Final Thoughts: Is a Recovery Coming?
Bitcoin’s recent decline highlights short-term holder sentiment and market uncertainty. While some traders continue to sell, the lack of massive exchange outflows suggests that many are still holding out for a rebound.
The next few days will be critical. If Bitcoin defends $87K, a recovery could be on the horizon. But a drop below this key level could mean further downside for investors.
