Bitcoin (BTC) Price 'Expected to See a Strong Rise' Within 1-2 Months, Quant Explains Why

Bitcoin SOPR Has Just Witnessed A Bullish Crossover

A technical indicator for Bitcoin (CRYPTO: BTC) suggests that the cryptocurrency may be poised for another strong rally.

What Happened: A crypto quant has highlighted the Spent Output Profit Ratio (SOPR) for Bitcoin, which is used to determine whether investors are selling their coins at a profit or loss on average.

The 30-day moving average (MA) of the SOPR fell below the 365-day MA earlier this year, indicating that investors were largely underwater on their holdings. However, the 30-day MA has now reversed and crossed above the 365-day MA.

This increase in the SOPR is due to the recent rally in the cryptocurrency, which has seen BTC price rise from around $70,000 at the beginning of November to highs of $97,000 earlier this week.

As the price of Bitcoin has risen, investors who purchased the cryptocurrency earlier in the year or last year are now sitting on large unrealized gains.

The quant pointed out the previous instances of this crossover in the indicator, each of which led into bullish price action for the asset.

"After the golden cross appears, the market usually starts a strong rise within 2 months at the latest."

This latest bullish crossover in the Bitcoin SOPR is the second time this cycle that the pattern has appeared, so it’s possible that the run now would lead the asset to its final peak of the cycle.

However, it remains to be seen whether the crossover between the monthly and yearly averages of the indicator will be bullish for BTC or not.