Bitcoin Market Sentiment Analyzed Through Short-Term Holder Metrics

According to BlockBeats, on-chain analyst Murphy has identified the realized price of Bitcoin's short-term holders (STH-RP) as a key indicator of market sentiment, serving as a boundary between bullish and bearish phases. A rapid rebound in price after touching the STH-RP suggests that new investors are not only refraining from selling near their cost price but are also attracting additional buying interest, indicating confidence in future market trends. Market sentiment typically evolves through three stages: Stage 1: Bitcoin slightly dips below the STH-RP and then rebounds significantly, reflecting investor confidence in the trend, viewing short-term corrections as opportunities. Stage 2: Bitcoin falls significantly below the STH-RP and rebounds slightly, indicating weakened investor confidence, though some still believe the trend is ongoing. Stage 3: Bitcoin's rebound fails to surpass the STH-RP, leading to consistent investor skepticism about the trend, with a tendency to exit when prices return to the cost line. From September 26 to 28, Bitcoin corrected to around $109,000, slightly below the STH-RP, before strongly rebounding to $125,000, corresponding to Stage 1. On October 17, the STH-RP was $113,000, with Bitcoin correcting to around $104,000, marking a significant drop. Last night, Bitcoin rose to touch the STH-RP before retreating, suggesting the market is currently in Stage 2 or transitioning between Stage 2 and Stage 3.