Bitcoin’s (BTC) ongoing volatility below the $110,000 mark is raising questions about whether the asset is destined for further losses, but historical data suggests otherwise.
According to on-chain data shared by analyst Ali Martinez, Bitcoin’s trader profit/loss margin currently sits around -5%. Historical patterns show that when this margin drops below -12%, the cryptocurrency tends to rebound strongly, signaling the end of major downtrends.
Martinez’s data, retrieved from CryptoQuant on October 22, shows deep negative margins, indicating widespread unrealized losses among short-term holders, which have historically aligned with cyclical bottoms in Bitcoin’s price.
Bitcoin profit/loss margin. Source: CryptoQuant
Each instance, including those in 2019, 2020, and 2022, preceded significant recovery phases.
Meanwhile, Bitcoin’s realized price, the average price at which all coins were last moved on-chain, remains below the spot price, meaning the majority of in
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