Bitcoin (BTC) is currently trading below $60,000 after experiencing a period of volatility and a significant 11% correction from its peak of $65,103 last Sunday. This sharp decline reflects the growing uncertainty and fear that is prevailing in the market.
Recent key data from Glassnode reveals a worrying slowdown in net capital inflows into BTC, signaling a potential shift in investor sentiment. The drop in inflows underscores the current market fragility and growing caution among traders. Coupled with recent price volatility and market turmoil, this data suggests that Bitcoin’s journey through this volatile phase is far from over.
As Bitcoin continues to navigate these challenging conditions, the risk of further volatility remains high, leaving investors bracing for more potential turmoil in the near term.
Bitcoin market equilibrium has been reached.
important Data from Glassnode This indicates a slowdown in net capital flows into Bitcoin, suggesting that a degree of balance has been reached between investors making profits and those facing losses.
Historically, capital flows into the Bitcoin market have rarely been as weak as they are now, with 89% of days seeing flows higher than those we are seeing today, except during periods of significant losses in bear markets. This current period of inactivity is noteworthy because it often precedes significant increases in market volatility.
The achieved cap, a key metric for understanding Bitcoin’s market cap, remains at an all-time high (ATH) of $619 billion, supported by a massive net inflow of $217 billion since Bitcoin’s low of $15,000 in December 2022.
Despite the prevailing negative sentiment and recent market turmoil, these indicators reveal potential for growth. The impressive realized market cap and strong net inflows suggest that while the market is in a calm phase, this could pave the way for an upcoming uptrend.
As Bitcoin continues to navigate this period of low flows and investor hesitation, the foundation for a potential rebound and increased volatility appears to be forming, offering hope for a positive shift in the market’s trajectory as the year progresses.
Bitcoin trading at a crucial level
Bitcoin (BTC) is trading at $59,541 at the time of writing, after three days of extreme price volatility. On the 4-hour chart, Bitcoin has faced a clear rejection from the 4-hour exponential moving average (EMA), a crucial resistance level that has consistently hampered price advances in recent weeks. Since Tuesday’s notable drop, Bitcoin has been hovering between $57,866 and $61,182, creating a range that could build liquidity for a major move.
If Bitcoin succeeds in breaking the 200 EMA for the 4-hours, it could pave the way for a rally towards $65,000. Such a breakout would signal a bullish reversal, which could lead to significant upward momentum.
However, if Bitcoin fails to overcome this resistance, it may test the next support level at $56,138. This level may become crucial in determining whether the current range phase will continue or a deeper correction is imminent.
Monitoring BTC’s ability to navigate through these key technical levels will be essential in predicting its near-term price direction and potential future movement.
Cover image by Dall-E, charts by Tradingview