Briefing
The market is entering a phase of selling exhaustion confirmed by the Short-Term Holder (STH) Supply in Profit dropping to an extreme low of 7.6%. This metric shows that almost all recent buyers are now holding losses, a condition that historically marks final capitulation before a market bottom or stabilization. This supply is being absorbed by large, high-conviction entities, with the number of wallets holding over 1,000 Bitcoin surging to a four-month high. The single most important data point proving this shift is the STH Supply in Profit falling to 7.6%, a level that has repeatedly aligned with cycle lows.
Context
The central question for most investors is whether the recent price correction represents a deeper structural collapse or a necessary flush of speculative excess. The average person wonders if the “smart money” is exiting alongside the general market fear, or if they are using the dip as a buying opportunity to increase their holdings. This data provides clarity on the behavior of these key investor cohorts.
Analysis
The Short-Term Holder (STH) Supply in Profit metric measures the percentage of Bitcoin held by investors for less than 155 days that is currently worth more than its purchase price. When this percentage drops dramatically, it means new buyers are holding losses and are vulnerable to panic selling, which is the final phase of a market correction. The current reading of 7.6% indicates a state of extreme retail capitulation, where less experienced investors are selling at a loss.
This selling pressure is being counterbalanced by a significant increase in the number of large wallets holding over 1,000 Bitcoin, a clear sign that experienced investors are absorbing the supply from fearful short-term sellers. This divergence confirms a transfer of coins from weak hands to strong hands.
Parameters
- Key Metric – STH Supply in Profit ∞ 7.6%. This is the percentage of coins held by recent buyers that are currently profitable.
- Whale Wallets (>1,000 BTC) ∞ 1,384. This is a four-month high for the count of large holder wallets.
- Retail Wallets (<1 BTC) ∞ Annual Low. The number of small wallets has declined, confirming retail exit.
Outlook
This data suggests the market is nearing a structural floor as the supply transfer from weak to strong hands completes. The current price range is a strong accumulation zone for large investors, indicating that the path of least resistance will shift upward once this supply absorption is finished. A confirming signal to watch is a rise in the STH Realized Profit-Loss Ratio back above 1.0, which would indicate that the average short-term seller is beginning to realize a profit again, signaling a price recovery.
Verdict
The market correction is completing its final stage of retail capitulation as large investors absorb the remaining supply.
