Market Dip Prompts Panic Among Bitcoin Speculators

As Bitcoin’s market price dipped below $70,000, some Bitcoin speculators reacted with alarm, according to data from Glassnode, an on-chain analytics firm. On October 31, short-term holders (STHs) offloaded approximately 54,000 BTC—the highest one-day volume since April.

STH Profits Fizzle Out as BTC Sheds Gains

The decline in BTC/USD from near all-time highs led some opportunistic Bitcoin traders to lose confidence. Data from Glassnode, which tracks transfer volumes from STH entities to exchanges, shows that on October 31 alone, 54,352 BTC (valued at roughly $3.76 billion) were sent to exchanges.

Understanding STH and Their Trading Behavior

STHs, or short-term holders, are wallets holding BTC for up to 155 days. Their trading is often reactionary compared to long-term holders (LTHs), who typically hold BTC for months or years without selling.

Price volatility tends to trigger STH selling, and Glassnode data suggests that their collective profit margin is being eroded, which may be intensifying their urge to sell.

The STH Spent Output Profit Ratio (SOPR), which measures the profit of coins moved, is now under 1.01, close to the breakeven point of 1. On October 29, it was nearly 1.04.

STHs Selling at a Loss as Pressure Mounts

Glassnode’s data also highlights that a significant portion of the BTC moved to exchanges on October 31 came from STH entities selling at a loss. This sell-off indicates growing pressure among STHs as they respond to market shifts.

Bitcoin’s $70,000 Risk Zone: “Deviation” or Continuation?

CoinGlass, a monitoring resource, indicates that the next significant price level is around $68,000, with order book liquidity now positioned between the current spot price and previous all-time highs.

Market analysts are divided on whether the recent trip past $73,000 was merely a “deviation” or part of a pattern seen in previous Bitcoin halving years. Notably, the X account HornHairs drew parallels with election cycles in 2016 and 2020, where BTC price dips were followed by sustained gains post-election.

“Derisking into the election 5-6 days before it takes place happened in both 2020 and 2016. Be careful what you sell here,” HornHairs advised followers.

Macroeconomic Data and Market Sentiment

The upcoming nonfarm payrolls report in the United States, scheduled for November 1, is a key macroeconomic indicator and is closely watched by risk-asset traders. The report’s outcomes may impact BTC prices as well as other volatile assets.