Bitcoin market indicators are reshaping as investors try to make up for weekly price losses of 4%, according to new research from on-chain analysis platform CryptoQuant.

In its Quicktake blog post dated January 10, CryptoQuant reported that a new “buy the dip” opportunity has emerged following the decline in Bitcoin price. While the bearish trend has gained strength this month due to volatility, Bitcoin bulls’ failure to regain the $100,000 level has negatively impacted market sentiment.

One sign of increasing capitulation among speculative investors has been the decline in the spent output profit ratio (SOPR). SOPR measures whether the coins in the transaction are in profit or loss compared to when they were last moved. This metric helps understand market sentiment by showing investors’ propensity to spend coins at a profit or loss.

Currently, the SOPR value for short-term investors (STH) is below 1. This shows that these investors who held Bitcoin for up to 155 days sold their coins at a loss.

CryptoQuant writer MAC_D noted that the decline in Bitcoin price has led to more and more negative headlines on YouTube and media platforms, indicating that market sentiment is bearish.

The SOPR value of short-term investors decreased to 0.987, indicating that investors who have been holding Bitcoin for less than 6 months are selling at a loss. While on the surface this may seem like a bearish trend, loss-making on-chain activity could be a positive signal for the bulls.

According to historical data, capitulation among speculative investors often coincides with short-term bottoms in the price of Bitcoin.

In August 2024, the STH-SOPR value reached a three-year low, coinciding with one of two short-term bottoms in BTC/USD around $55,000.

“Ironically, when short-term investors make losses, the market often shows an upward trend, making it a good time to accumulate,” the blog post said.

Other market sentiment indicators paint a similar picture. The Crypto Fear & Greed Index returned to the “Neutral” zone this week, hitting its lowest level since October.

However, this is still higher than the equivalent index of traditional markets; In traditional markets, this value is currently in the “Fear” zone with only 32/100.

At the same time, large-cap investors increased their Bitcoin purchases in the post-holiday period. According to CryptoQuant, Bitcoin whales added 34,000 BTC in the 30-day period through January 8. MAC_D stated that if short-term investors lose more, smart investors will tend to accumulate Bitcoin at these low prices.

“As short-term investors make losses, this often provides better opportunities for accumulation,” MAC_D said, emphasizing that selling more at current levels may not be a wise decision.