Bitcoin ($BTC) faced slight losses in the last few days of trading. The streak of inflows into spot ETFs was just broken at nine months. $225.1 million spill on Thursday, July 23rd.
Bitcoin was still trading in a long-term downward price trend. Bulls can’t break through $67,000 The local supply zone has given the bears back control of the market.
What this means for investors
Bitcoin MVRV and realized losses show this
If the MVRV ratio is greater than 1, it indicates that the aggregate holder is still making a profit. Historically, the depths of a bear market are only reached when MVRV falls below 1.
Cryptocurrency analyst Ray Researcher noted that this has not been the case so far in the current cycle. Although the market was far from bullish overheating territory, it had not yet reached the bottom of a bear market.
On-chain data showed that the cyclical capitulation may not be over yet. The recent rally may have provided an opportunity for some long-term holders to reduce their exposure ahead of further declines.
Analyst The Chess Onchain believes that Bitcoin’s supply margin is currently 57.5%. of 30 day average For long-term holders, the SOPR should return to 1.0 to ensure the end of the bearish trend. This indicator is: 0.86 now.
Taking this event as a historical bar, analysts believe that the supply of profit indicators will be at least 64%. Any apparent price recovery will likely occur in a bearish regime until the indicators rise above these levels again and remain there for several weeks.
Furthermore, when the price rebound began in early June, $BTC After 6 months, 12%-16% Foreign exchange inflows decreased, and then 0.8%.
The cost basis for a cohort of holders who purchased between 1 month and 2 years ago is $72,000 – $102,000 window.
Supply overhangs are another threat to a sustained recovery. Therefore, there could be another wave of selling and further capitulation that forces these holders to sell, and traders and investors should be prepared for that.
This data suggests that Bitcoin is not yet out of a broadly bearish regime.
Final summary
- Bitcoin’s MVRV ratio has not yet fallen below 1.0, which has tended to mark bear market bottoms in past cycles.
- This time it may be different, but the Profit Supply and LTH SOPR metrics are also showing the same thing. In other words, the current price rebound is in a bearish regime.
