Bitcoin May Be Sold Off When This Metric Reaches 4%, Analyst Explains

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While Bitcoin (BTC) fluctuates around the critical price level of $100,000, some investors may look for the perfect opportunity to take profits and exit the market. In this context, the CryptoQuant analysis identifies key BTC metrics that can be a valuable tool for creating an exit strategy.

Are there profits in Bitcoin? Keep an eye on this sign

In a Quicktake blog post published today, CryptoQuant contributor Onchain Edge divided insight into the timing of selling BTC during the current bull market. The analyst emphasized the importance of Bitcoin's supply in the loss metric, noting that it is able to identify when to start pulling away from the market to preserve profits.

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For those unfamiliar with Bitcoin, the provision in loss measures the percentage of BTC held at a loss based on the last price moved. A low percentage of supply in loss usually indicates peak market euphoria and serves as a warning to take profits before a bear market correction begins.

According to CryptoQuant's analysis, when BTC's loss supply falls below 4%, it marks a good time for investors to consider dollar cost averaging (DCA) out of their BTC holdings and wait for the next bear market stages. Currently, BTC supply is in loss at 8.14%.

Supply BTC in loss — Source: CryptoQuant

DCA is an investment strategy where investors allocate a fixed amount of money to an asset at regular intervals, regardless of its price. This method helps reduce the impact of market volatility and lowers the average cost per unit over time. The analyst adds:

Why? Below 4% means that many people are in profit and this is the highest level of bulls. Trust me you don't want to be in the sack because you thought we'd never see another bear market. Be fearful when others are greedy.

Analysts confident of further upside in BTC price

While tracking the supply of BTC in a loss metric may help investors protect their profits, recent predictions from crypto analysts suggest that there may still be room for more upside before this indicator becomes critical.

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According to crypto analyst Ali Martinez, BTC forms classic cup and handle pattern on the weekly chart. The major cryptocurrency looks set to break out of the bullish formation, with targets as high as $275,000.

Similarly, Donald Trump's victory has brought new hope to the crypto industry. In the recently concluded Bitcoin MENA conference in Abu Dhabi, former Trump campaign chairman Paul Manafort said, was noted that BTC investors “can expect over $100,000” during the ongoing market cycle.

Other predictions remain just as strong. Tom Dunleavy, Chief Investment Officer at MV Global, projects BTC to reach $250,000, and Ethereum (ETH) could climb to $12,000 during this market cycle. BTC trades at $100,983 at press time, up a modest 0.1% in the past 24 hours.