"Bitcoin profit-taking ratio at 2.95x…on-chain indicator revives 'short-term top signal'"
Summary
- On-chain data analytics firm Santiment said Bitcoin’s ratio of profit transactions to loss transactions was 2.95 to 1 over the weekend.
- Santiment explained that periods where profit transactions strongly dominate have historically acted as a short-term price-top signal for Bitcoin.
- It added that, conversely, periods where the share of loss transactions exceeds profit transactions can be interpreted as a buy signal.
Forecast Trend Report by Period
An on-chain analysis said Bitcoin (BTC) showed signs of a short-term top over the weekend as the share of profit-taking transactions rose sharply.
On the 6th, on-chain data analytics firm Santiment said, "Over the weekend, Bitcoin posted a 2.95-to-1 ratio of profit transactions to loss transactions." This means that transactions moved while in profit relative to acquisition outnumbered transactions moved at a loss by nearly threefold.
Santiment explained, "Historically, periods where profit transactions markedly dominate have served as a short-term price-top signal." It added, "In general, as profit-taking increases, downside pressure on price tends to emerge."
Conversely, periods where the share of loss transactions exceeds profit transactions can be interpreted as a buy signal. The indicator is used as an on-chain metric to gauge selling pressure and buying opportunities based on market participants’ profit-and-loss status.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
