- Bitcoin’s unrealized losses continue to dominate as BTC continues to consolidate.
- Despite rising losses, investors are yet to capitulate and remain optimistic.
Over the past week, Bitcoin [BTC] has traded within a parallel channel, consolidating between $82,000 and $86,000 without clear direction.
With the lack of upward momentum, investors who bought Bitcoin at these levels continue to record significant losses.
Inasmuch, according to CryptoQuant, Bitcoin’s Realized Losses are currently dominating the market.
As such, Bitcoin’s Profit/Loss Ratio (7DMA) has dropped below its critical level of 1. The recent drop indicates that the majority of investors are currently realizing losses.
Source: CryptoQuant
These losses are mounting, especially among short-term holders. In fact, Bitcoin’s Short-term Holder SOPR has dropped below 1 to settle at 0.9 at press time.
The decline here suggests that short-term holders are selling at a loss.
Source: CryptoQuant
On top of that, Bitbo data confirmed that STHs faced Unrealized Losses. Their Realized Price stood at $92,174—far above current spot prices near $84,000.
Source: Bitbo
However, it’s worth noting that the drop does not necessarily signal a full-blown capitulation but rather a phase of doubt or potential accumulation.
Looking at previous cycles, we can observe that whenever the ratio reached the +4 STDV deviation from the 365DMA, a local market top consistently formed, followed by a short-term correction during the bull phase.
With a high level of uncertainty prevailing in the markets, there is a better chance that a capitulation phase may unfold, potentially driving realized losses even higher.
Is capitulation ahead for BTC?
Although unrealized losses are dominating, investors have not turned to selling. On the contrary, investors are optimistic and expect Bitcoin prices to move higher in the near team.
Source: CryptoQuant
For instance, Bitcoin’s Fund Flow Ratio fell from 0.13 to 0.06 over four days—indicating fewer exchange deposits from retail investors.
Moreover, whale behavior echoed this restraint. The exchange whale ratio dropped from 0.51 to 0.37, implying whales were staying put—or even accumulating.
Source: CryptoQuant
What comes next?
In conclusion, although unrealized losses continue to rise, investors have yet to capitulate. As such, Bitcoin holders are hopeful and expect prices to regain higher levels.
If these sentiments can hold, we could see Bitcoin reclaim $86078. However, if STH starts to sell to avoid more losses, BTC will retrace to the lower boundary of the consolidation channel around $82800.
