Bitcoin (CRYPTO:BTC) could be exposed to another sharp sell-off as speculation builds around a possible Japanese yen intervention.
Previous yen intervention episodes coincided with Bitcoin falling roughly 30% from local highs before stabilising.
Traders are closely watching the historical pattern, often referred to as the yen carry trade fractal, for clues on the next move.
A yen intervention occurs when Japanese authorities step into foreign exchange markets to strengthen the currency.
This typically involves selling US dollars and buying yen to slow excessive depreciation.
Over the weekend, market attention intensified after reports that the New York Federal Reserve conducted rate checks in the USD/JPY pair.
Such checks are often viewed by foreign exchange traders as an early signal of coordinated intervention.
These developments followed public comments highlighting close coordination between the United States and Japan on currency matters.
In the two most recent intervention periods, Bitcoin declined by about 30% as leveraged yen carry trades were unwound.
The selling pressure during those phases eventually gave way to strong recoveries.
In both historical cases, Bitcoin went on to rally more than 100% after forming a base.
The same scenario is about to occur now.
Mikybull Crypto said.
Bitcoin will first dump and rally afterward
He added.
Based on this fractal, traders see downside risk toward the $65,000 to $70,000 range.
Onchain data suggests the market may not yet have reached full capitulation.
Analytics platform Alphractal said Bitcoin has not formed a confirmed cycle bottom.
One key indicator supporting this view is net unrealised profit and loss, or NUPL.
NUPL measures whether holders are sitting on unrealised gains or losses.
As of the latest data, NUPL remains above zero despite trending lower.
This indicates the majority of Bitcoin holders are still in profit.
In previous market cycles, durable bottoms typically formed only after NUPL turned negative.
A negative NUPL historically signalled that most holders were underwater.
That shift often marked the exhaustion of selling pressure.
Current data shows the share of Bitcoin supply in profit at around 62%.
This represents the lowest level since September 2024, when Bitcoin traded near $30,000.
Bitcoin’s delta growth rate has also dropped into negative territory.
This metric compares market value with realised value across the network.
A negative reading suggests price is drifting closer to the average cost basis.
Such conditions point to reduced speculation and a transition into accumulation.
Analysts say the process can be uncomfortable for investors in the short term.
Alphractal said prolonged drawdowns often create long-term buying opportunities.
This assessment aligns with the historical pattern seen during past yen interventions.
At the time of reporting, Bitcoin price was $87,821.87.