Glassnode warns Bitcoin could drop to $58,500 if it fails to hold support at $63,000 amid weak demand.
Glassnode reports that the Bitcoin market is currently "compressed," with prices trapped between a median realized price of $63,000 and a short-term holder cost basis of $68,700.
Despite favorable macroeconomic indicators, including a U.S. core inflation rate of 2.5% in July and American stocks nearing record highs, Bitcoin has not shown significant recovery, primarily due to weak demand.
Analysts suggest that if Bitcoin can break above $68,700, it may signal a return to profitability for recent buyers and an improvement in market structure. Conversely, a drop below the $63,000 support level could lead to a decline toward June's low of around $58,500, with a further support level identified at $52,800.
Glassnode has also noted signs of seller fatigue, as the percentage of profitable supply is nearing levels seen at the end of previous bear markets. Additionally, there have been nine unsuccessful attempts to recover to the breakeven level of the Spent Output Profit Ratio (SOPR), indicating market weakness.
Moreover, consistent demand has yet to emerge, with net flows into ETFs only turning positive at the end of July, remaining weaker than during earlier accumulation phases. Coins continue to flow onto exchanges, which increases supply pressure.
Risks related to derivatives are also highlighted, as large traders on Hyperliquid have maintained a net long position since mid-March, while open interest in futures has surpassed daily trading volume. Furthermore, the depth of buy orders has decreased by about one-third since early July.
On August 10, a contributor from CryptoQuant, known as ShayanMarkets, detailed the nearest resistance levels for Bitcoin, further emphasizing the current market dynamics.
