Bullish On-Chain Signals Meet Unrealized Losses in Bitcoin Market

Bitcoin's on-chain metrics have shifted to bullish territory, indicating that long-term holders are accumulating and selling pressure is easing. However, a significant portion of short-term holder supply remains in an unrealized loss position, which could limit any potential price gains.

The MVRV ratio and exchange netflow have turned positive, suggesting a potential bottoming process. This may precede a price recovery, as these metrics indicate that the supply of Bitcoin available for sale is shrinking.

However, the same data reveals that many investors bought at higher prices and are currently underwater, creating resistance to any upward movement. The Spent Output Profit Ratio (SOPR) remains below 1 for several cohorts, indicating that recent transactions are being sold at a loss.

The current mix of bullish momentum and loss-heavy supply creates a tug-of-war, making sharp rallies less likely until this overhead supply is absorbed. Traders should watch how the price reacts at key resistance levels to determine the next major trend.