Recent market trends indicate that Bitcoin buyers, especially those who acquired the cryptocurrency around its historic peak of $109,000 in January, are increasingly engaging in panic selling as prices dip. An analysis report has termed this situation a “moderate capitulation event,” reflecting the pressure exerted by top buyers looking to recoup losses amidst a bearish trend.
As of now, Bitcoin is trading at approximately $81,930, showing a decrease of around 5.90% over the past week. This price retreat leaves many short-term holders—those who hold their Bitcoin for less than 155 days—with an unrealized loss averaging 10.6%. The short-term holder realized price has notably increased from $62,000 to $91,362 in just five months, highlighting a significant surge in buying at higher price levels. Glassnode’s data emphasizes that the current market momentum has turned negative, which could lead to further declines.
Glassnode also warns that the potential of Bitcoin’s price dropping as low as $70,000 looms large if the selling pressure continues. This scenario is especially concerning for short-term holders who are now considered “deeply underwater” in the price range between $71,300 and $91,900. The report suggests that the likelihood of a temporary price floor forming in this area is quite significant in the near term. This sentiment is echoed in a recent note from market research firm 10x Research, which characterized the sell-off as a “textbook correction.”
Investors are facing a challenging atmosphere characterized by uncertainty and fluctuating confidence levels. Many selling actions are reportedly coming from investors who entered the market recently; approximately 70% of all recent sales are attributed to buyers active within the last three months. BitMEX co-founder Arthur Hayes noted that Bitcoin may attempt to retest the $78,000 level, and should that resistance fail, it could subsequently seek the $75,000 mark.
Historically, similar patterns of sell-offs have been witnessed, particularly during the market downturn in August when Bitcoin’s price plummeted from $68,000 to around $49,000 due to macroeconomic factors and investor apprehensions regarding a recession. Despite these pressures, recent market fluctuations have seen Bitcoin spike by 7.5% in a 24-hour period, signifying a brief upturn and a potential rebound in market sentiment. However, analysts remain cautious and recommend conducting thorough research before making any trading decisions.
