The Bitcoin market is undergoing a noteworthy decline following a strong first half of the year. Signs of decreasing liquidity and caution are becoming increasingly evident.
Widespread Decline in Bitcoin Markets
Currently, the Bitcoin market is experiencing instability, which is highlighted in the latest Glassnode report that notes a significant decline in bullish momentum. According to the report, all indicators – spot, derivatives, and ETFs – are indicating negative trends. In the spot market, indicators show a rapid deterioration of the technical structure, including a drop in RSI from 47.4 to 35.8.
Demand for assets is declining, leading to increasing selling pressure. This is evidenced by a drop in CVD from -107.1 million dollars to -220 million dollars and a decrease in daily volume from 8.4 to 7.5 billion dollars.
Changes in On-Chain Activity
Amid traditional financial markets, on-chain activity presents a more varied perspective on the current situation. The number of active addresses increased by 3.6% to reach 729,000, while transferred volume fell by 13.9% to 9.4 billion dollars. Despite an overall decrease in activity, some metrics, such as Realized Cap Change, remain high.
However, on-chain profitability indicators reflect increasing caution in the market. The percentage of supply in profit decreased to 93.6%, and the Realized Losses/Profits ratio dropped to 1.9.
Prospects for Recovery
According to Glassnode's analysis, the market appears to be transitioning from a phase of euphoria to a phase of reassessment, with technical conditions for a potential short-term rebound. However, given the fragility of the current market structure, the likelihood of future gains will depend on external catalysts or renewed demand. Currently, uncertainty remains, making any forecasts for recovery weak.
In the current market environment, Bitcoin exhibits signs of caution with an overall trend toward decreased liquidity. Investors should be vigilant in their future predictions.
