Bitcoin Edges Closer to Turning Point as Traders Hit Breakeven

Traders' profit margins for Bitcoin (BTC) have reached "basically zero," signaling a potential end to selling pressure. Analysis from CryptoQuant shows that traders have returned to the breakeven point of $60,000 on exchange holdings, suggesting that realized losses may be avoided, leading to a possible turning point in BTC's downward trend.

Bitcoin Nears Turning Point as Profit Margins Evaporate Amidst Market Correction

In a significant development that could mark a turning point in Bitcoin's price trajectory, traders' profit margins have reached "basically zero," potentially alleviating selling pressure on the cryptocurrency.

According to research published on social media by Julio Moreno, head of research at on-chain analytics firm CryptoQuant, a crucial reset is underway in the Bitcoin market. Data indicates that traders have returned to breakeven point on exchange holdings at $60,000.

"Bitcoin selling pressure from traders may be declining as unrealized profit margins are basically zero now," Moreno summarized.

An accompanying chart depicts the profit and loss margins of short-term holders (STHs), defined as Bitcoin entities holding BTC for 155 days or less. These speculators have effectively exhausted profitable trades, suggesting that selling may now subside to prevent further losses.

Moreno further noted that historically, traders' realized price, represented by the pink line on the chart, has acted as support for prices during bull markets. Currently, it hovers around $60,000.

Since Bitcoin began retracing from record highs in March, only one brief dip below the $60,000 level has occurred. Such retracements are typical after all-time highs are reached, and the recent surge before the block subsidy halving in May heightened expectations for a price correction.

Returns to STHs' realized price have frequently marked market bottoms, and the trendline has provided continuous support since the end of the 2022 bear market. Only briefly in August last year did Bitcoin trade below this critical level.

Tentative Relief Bounce Amidst Ongoing Correction

On April 18, Bitcoin experienced a relief bounce, reaching $64,182 on Bitstamp, providing temporary respite from the ongoing correction.

"This is now an -18% deep pullback that has lasted 10 days thus far," observed popular trader and analyst Rekt Capital. "Depth-wise, this is very close to bargain-buying territory based on pullbacks in this cycle (up to -23% deep at most)."

"Time-wise however, this is still one of the shortest retracements in this cycle (currently only 10 days long). Previous pullbacks have lasted 2-3 weeks and at most up to two months."

Another trader, Skew, emphasized the need for more evidence of spot demand to confirm a full-fledged recovery.

It is important to note that this article does not provide investment advice or recommendations. Cryptocurrency markets are inherently volatile, and investors should conduct their own due diligence before making any trading decisions.