Key takeaways:

Bitcoin profitability metrics say that BTC has entered the early stages of a “real rally.”

BTC price recovery may face stiff resistance at $84,000, with a pullback likely.

Bitcoin profitability suggests BTC rally “has begun”

Bitcoin’s recent price recovery toward $76,000 has pushed it more than 26% above its sub-$60,000 multi-year low reached on Feb. 6.

This was accompanied by an increase in the Spent Output Profit Ratio (SOPR), which hit an eight-month high of 2.87, after dropping as low as 0.62 in early February.

SOPR is a metric used to show whether Bitcoin investors have made a profit or loss compared to when they first held Bitcoin. This ratio has historically marked the short-term bottom for BTC when it hits its lowest point.

“The $BTC SOPR Ratio shows that $BTC has already broken out of the bottom and is rising,” CryptoQuant analyst CW8900 said in a Tuesday post on X, adding:

“The bottom for $BTC was formed last February. The rally is already in progress.”

Similarly, Bitcoin’s Net Unrealized Profit/Loss (NUPL), the difference between total profits and losses currently held by investors, has flipped positive for the first time since early January.

This suggests that the downtrend for Bitcoin has ended, and the “real rally of this cycle has begun,” CW8900 said in another X post.

This structurally resembles conditions seen in early stages of previous bull markets, where the NUPL recovered from extended periods below zero as Bitcoin embarked on a sustained rally.

1.1 million BTC at $84,000 could trigger sell-off

According to Bitcoin’s cost basis distribution data, investors hold approximately 1.1 million BTC at an average cost of $84,000, creating a potential resistance zone. This concentration suggests many investors may sell at break-even, potentially stalling Bitcoin’s upward momentum.

As Cointelegraph reported, Bitcoin’s immediate resistance is at $78,000, where the true market mean currently sits.

The US spot Bitcoin ETF cost basis at $83,100 is seen as the next key hurdle.

Analyst AlphaBTC said the
BTCUSD
pair might rise higher to fill the CME gap at $84,000, which was created at the start of February.

As Cointelegraph reported, a close above the $76,000-$78,000 resistance zone would confirm that the buyers are in control, clearing the path for a potential rally to $84,000.
source: https://www.tradingview.com/news/cointelegraph:5cee4c989094b:0-bitcoin-price-rally-in-progress-but-upside-may-be-capped-at-84k/