Journalist
Posted:
Bitcoin [BTC] has remained range-bound over the past two weeks, fluctuating between the $60,000 and $72,000 extremes. At the time of writing, it was trading at $67.8k and showing minor upside momentum in the short term.
However, market-wide sentiment remained extremely fearful. While institutional investors’ plan remained “buy more” despite the pain, short-term volatility risks remained.
AMBCrypto warned that traders looking to go long could face a long squeeze. This was due to the leveraged longs and the rising long/short ratio in this consolidation phase.
These developments could push the market towards a phase of maximum stress necessary to form a market bottom in the longer term.
Bitcoin’s Absence of a ‘Complete Purge’
The signal of selling pressure has been absent for almost three years and the Bitcoin price remained above the realized on-chain price at $54.8k. The number of days in which this absence of strong network stress occurred reached a record 1,133 days, crypto analysts said Axel Adler Jr.
The analyst also highlighted the three most important baseline levels of network costs to watch. The short-term holder realized a price of $91.4k, the network realized price at $54.8k, and the long-term holder realized a price of $38.7k.
To assess the cyclical risk for holders, the realized price level of $54.8k must be scrutinized. A sustained decline below this level will push the average position into a loss. This activates the selling pressure indicator to indicate a phase of maximum network stress.
The current market regime was bearish. The long-term holders were making profits and the maximum stress phase had not yet arrived.
The $54.8k is an important barrier where Bitcoin is at increased risk. It is also a level that has been a structural support in recent cycles.
In one message on Xanalyst Donkerfost wrote that monthly cumulative demand for Bitcoin has turned positive after nearly three consecutive months of low demand.
This measure was an early sign that while the longer-term market environment remained bearish, structural accumulation was able to absorb the new supply.
A few weeks of sustained positive monthly cumulative demand would be needed to signal a BTC recovery.
Final summary
- The realized Bitcoin price of $54.8k was an important structural buffer. It separated bearish conditions from phases of maximum pressure on holders.
- The positive shift in apparent demand was an early constructive sign amid the prolonged bearish pressure.