Short-term holders of the first cryptocurrency (STH) have begun selling at a loss for the first time since January 2025, reported CryptoQuant analyst Kripto Mevsimi.
He said the SOPR metric for this cohort has fallen below 1. That signals realised losses.
The last such episode came in January 2025, when the market endured the deepest correction of the current cycle.
The analyst sketches two possible paths. The first is fading momentum: an extended bout of loss-taking can precede a downturn as speculative investors leave the market.
The second is a “healthy reset”. A brief dip in the gauge may flush out weak hands and clear the way for a more durable rally.
He stressed that bitcoin is consolidating below stiff resistance. The market’s reaction to selling will be telling. If selling pressure is absorbed quickly, it could signal a strong rebound. Failing that, the uptrend risks breaking.
“Bear trap” before an advance
A developer going by DeFiTracer drew attention to a historical pattern in bitcoin’s bull cycles. In his view, the current set-up echoes past episodes that preceded gains.
Bitcoin Macro bull-cycles
2011:
— Duration 9 Months (after ATH)
— Bear trap in Month 62013:
— Duration 9 Months
— Bear trap in Month 62017:
— Duration 9 Months
— Bear trap in Month 62021:
— Duration 9 Months
— Bear trap in Month 62025:
— We just entered Month 6…Do… pic.twitter.com/2vp9a9ylOr
— ᴛʀᴀᴄᴇʀ (@DeFiTracer) August 18, 2025
DeFiTracer analysed the 2011, 2013, 2017 and 2021 cycles. He noted that each lasted about nine months after setting a new price high.
A defining feature in all those periods was a sizeable correction in the sixth month. The analyst characterised it as a “bear trap”, when the market misleads investors before a new wave of growth.
By his model, the current cycle, which began in 2025, has also entered its sixth month. He therefore urged investors not to panic and not to sell into declining prices.
A weakening uptrend
A market-breadth indicator points to short-term softness in the crypto sector and the Nasdaq, noted CoinDesk analyst Omkar Godbole. The long-term trend on both markets remains upward.
According to TradingView, 63 of the 100 largest cryptocurrencies by market value are trading above the 200-day simple moving average (SMA). This indicator is considered a barometer of long-term trends.
At the same time, half of these assets have slipped below the 50-day SMA, which reflects the short-term trend. Trading below that average points to a loss of momentum.
The Nasdaq index, which includes 100 technology companies, showed a similar picture. Sixty-one stocks are above the 200-day SMA, and 49 are below the 50-day.
In Godbole’s view, the synchronicity points to a broader tendency across markets. Traders are likely trimming risk ahead of remarks by Fed chair Jerome Powell at the Jackson Hole symposium.
Signs of an overheated bitcoin rally
Bitcoin has set a fresh all-time high, but the subsequent pullback has made traders question the rally’s strength. Santiment analysts highlighted several key on-chain metrics pointing to potential overheating.
The primary signal is a bearish divergence between price and transaction volume. The 13 August price record came on daily volume of $30.88bn. That is well below the $48.87bn peak logged a month earlier at lower prices. Rising prices on falling volumes often indicate a weak foundation for a rally.
Another sign is a sharp rise in retail activity, typically linked to FOMO. Over the past nine days, the number of non-zero bitcoin addresses increased by 470,000, from 55.96m to 56.43m. Such rapid inflows of new participants have historically preceded corrections.
Risk is also underscored by the MVRV metric, which gauges traders’ average profit or loss. For bitcoin, the 365-day reading stands at +21%. That implies the average investor who bought over the past year is sitting on sizeable gains, raising the odds of profit-taking.
The picture for Ethereum looks even riskier. Its 30-day MVRV has exceeded +15.5%, and the 365-day measure has reached +57%. Such elevated unrealised gains have historically signalled a high likelihood of a correction.
At the same time, large bitcoin holders (from 10 to 10,000 BTC) continue to accumulate. Within 72 hours of the new high, this cohort added 23,000 BTC to their wallets. Such whale behaviour is bullish and points to confidence in further price gains.
In July, Godbole warned of waning bullish momentum in bitcoin.