Bitcoin SOPR Breakout Sparks Reversal Hopes Amid ETF Inflows

The Spent Output Profit Ratio (SOPR) metric has broken out of an 11-month suppressed state, signaling potential cycle reversal in the Bitcoin market. According to CryptoQuant, this development could be a sign that the market is shifting towards a new phase.

SOPR measures whether Bitcoin holders are selling their coins at a profit or a loss. When the ratio sits above 1.0, it means the average coin being moved is being sold for more than it was purchased. Below 1.0, holders are realizing losses.

CryptoQuant's analysis points to a pattern similar to early 2023, when SOPR behavior preceded a historic Bitcoin rally. The firm observed multiple instances of the STH-SOPR (short-term holder version) dipping below 0.95 before bouncing back above 1.0.

The bigger on-chain picture suggests that long-term holders are neither panic-selling nor aggressively taking profits, as indicated by the LTH-SOPR drifting towards neutral territory.