Indicator Overview

The SOPR Distribution indicator measures the historical frequency and statistical positioning of the Spent Output Profit Ratio (SOPR) since February 2013. SOPR is a fundamental metric that represents the realised profit or loss of the entire Bitcoin market by comparing the price of Bitcoin at the time an output was created versus when it was spent. A value of 1.0 represents the break-even point.

This distribution model maps daily SOPR readings into high-resolution "buckets" to visualise the market's psychological state, specifically whether investors are selling at a profit or capitulating at a loss. By highlighting the current SOPR within this historical context, the indicator identifies whether the market is in a sustainable trend or at an extreme point of exhaustion. 

How To Use

The distribution is primarily used to identify market resets and exhaustion points by quantifying how much profit or loss is being realised relative to historical norms.

• The Green Zone (Capitulation/Opportunity): Values falling into the left-hand green buckets (typically below 1.0) signal that the market is spending coins at an aggregate loss. Historically, sustained periods below 1.0 are rare and represent capitulation events, which often mark major market bottoms. In a healthy bull market, a dip toward 1.0 acts as a reset where sellers are exhausted, providing a high-probability entry point.

• The Red Zone (Overheating/Profit-Taking): Values shifting into the right-hand red buckets (typically above 1.05 and escalating toward 1.25+) indicate that investors are realising significant profits. The deeper into the red zone the indicator moves, the more overheated the market becomes, signalling a higher probability of a local or cycle top as sell-side pressure outweighs demand.

• The 1.0 Break-Even Line: This is the equilibrium point of the distribution. In a bull market, the 1.0 line often acts as support; in a bear market, it acts as resistance. This indicator shows how much time Bitcoin spends oscillating around this critical psychological level.

• % Days Spent Below: This metric provides a percentile ranking for current profit realization. If SOPR has a "98% Days Below" reading, it confirms that current profit-taking is higher than 98% of all days in Bitcoin's history, signaling extreme vertical exhaustion.