BTC and ETH sell-off strengthened historically positive metric: Santiment

BTC and ETH sell-off strengthened historically positive metric: Santiment

By Benson Toti - min read
  • BTC and ETH coins sold at a loss for the first time in 2023 this week
  • Historically this has signaled bottoming in crypto markets.
  • Bitcoin and Ethereum prices have both bounced above key price levels.

As Bitcoin and Ethereum look to consolidate above key price levels, on-chain analytics platform Santiment has flagged market activity that suggests the crypto bottom is likely to be forming. 

The metric we are looking at is the ratio of profit/loss transactions for the two top cryptocurrencies by market cap.

BTC and ETH traders exited positions at a loss- likely positive for prices?

According to analysts at the firm, price declines over the past week came amid increased selling from traders who were exiting their positions at a loss. The market has historically bottomed when an increased number of crypto holders – the crowd – regularly sell their assets at a loss, Santiment noted.

Bitcoin and Ethereum are both having more traders sell at a loss than at a profit this week, the first such week so far in 2023. Historically, once the crowd is exiting their positions more frequently at a loss, bottoms are more likely to form.”

Bitcoin traded to prices under $23k over the weekend before bouncing above the crucial level to hit highs of $23,690 across major exchanges. BTC/USD is currently trading around $23,410, just in the green.

Ethereum prices also followed a similar trajectory, first dipping to $1,597 before recovering to $1,647. ETH/USD price has increased 2.3% in the past 24 hour