The first cryptocurrency has been trading below the average market price and the cost basis of short-term holders for five months. According to Glassnode, this is one of the longest periods of "deep undervaluation" for the asset in history.
Source: Glassnode.Long-term investors are actively realizing losses, accounting for 43% of the total realized volume on the network. This category of market participants is losing about $280 million daily, the highest since December 2022. Analysts have termed this capitulation, which typically precedes the formation of a price bottom.
Meanwhile, there continues to be an outflow of funds from U.S. spot Bitcoin ETFs. On July 8, the net outflow reached $84.86 million. Trading volumes in this sector have dropped by 80% compared to peak levels last fall.
Source: SoSoValue.In contrast, the Ethereum ETF segment has seen capital inflows for five consecutive days.
Source: SoSoValue.Experts at QCP Capital noted that the market lacks a "monetary cushion." Weakness in the U.S. labor market and high inflation are limiting the Federal Reserve's options.
Glassnode believes that conditions for a trend reversal have already formed based on blockchain and derivatives data. However, for Bitcoin to confirm a rise, it needs to hold above $76,600, and selling from major players must decrease.
On July 7, CryptoQuant analyst known as TheChessOnChain pointed out the risk of the first cryptocurrency falling below $58,000.
On July 8, the price of digital gold dropped to around $61,700 following renewed tensions between the U.S. and Iran.