Long term holders are usually less influenced by short term price movements, so when they begin selling at a loss, it often reflects widespread fear in the market.
Data shared by on chain analyst Crypto Dan indicates that Bitcoin long term holders are currently selling at a loss.
According to his analysis, this may suggest that the market is nearing a stage where selling pressure begins to fade, potentially signaling that a major cycle bottom is approaching.
What the Data Suggests
In a market update published on March 31, Crypto Dan highlighted a key indicator known as the Long Term Holder Spent Output Profit Ratio. This metric measures whether Bitcoin held for more than 155 days is being sold at a profit or a loss. When the value is above 1.0, it indicates profit taking, while a reading below 1.0 points to losses.
He explained that when this metric drops below 1.0, it carries more significance than similar behavior from short term holders. This is because long term investors are typically less reactive to temporary price fluctuations. When they begin selling at a loss, it often signals that fear has spread across the broader market.
The analyst added that by the time long term holders are realizing losses, short term participants have usually already exited or absorbed heavy losses. At that stage, most traders are operating at a deficit.
Historically, such conditions have marked what he described as the final stage of fear, where selling pressure gradually weakens and markets approach their lowest points or zones close to long term bottoms. While he did not confirm that the exact bottom has been reached, he noted that such environments often create opportunities after periods of intense fear.
Shift in Whale Activity
Another analyst, Darkfost, observed a noticeable change among large investors. Whale selling activity on Binance has slowed significantly after a phase of heavy distribution.
Earlier in the year, when Bitcoin approached 60,000 dollars, whales became highly active on the platform. On February 4, more than 11,000 BTC were deposited to Binance in a single day, pushing the 30 day average of daily inflows from about 1,000 BTC to nearly 4,000 BTC by the end of the month.
Since then, the average has declined to around 1,600 BTC per day. Darkfost described this shift as large investors adopting a wait and see approach instead of continuing aggressive selling.
Where Analysts Think the Market Is Headed
The capitulation signals are not limited to on chain data. Analyst Ali Martinez recently pointed to a recurring technical pattern involving the 50 day and 200 day simple moving averages on the three day chart. Similar patterns appeared near market bottoms in 2014, 2018, and 2022.
In the current cycle, this crossover occurred on February 27. Based on previous declines of 40 to 50 percent before those historical bottoms, Martinez believes potential accumulation zones could form around 40,000 dollars, with a deeper correction possibly pushing Bitcoin closer to 30,000 dollars.
Using traditional valuation models such as the CVDD Floor, which is currently near 45,500 dollars, analyst Willy Woo estimated that the bottom may fall between 46,000 and 54,000 dollars.
Meanwhile, Doctor Profit suggested a possible bottom range between 35,000 and 45,000 dollars. However, he also noted that Bitcoin could still see a short term rally toward the 79,000 to 84,000 dollar region before any final decline takes place.#crypto#cryptonews https://coinsignals.net https://t.me/coinsignalpublic
