With a short bounce, bitcoin price It has now broken above the important $70,000 level and is once again showing signs of bullish traction. As a result, BTC appears to be showing early signs of stabilization following the wave of capitulation sweeping across the market.
Bitcoin realized losses dominate the market
The broader cryptocurrency market is showing positive signs, with Bitcoin prices turning slightly bullish since then. period of surrender. However, the underlying on-chain data shows that the current market pain is far from over.
CryptoQuant Verified Author and Market Expert Darkfost share Although market losses have lessened since the capitulation, realized losses still dominate Bitcoin in a situation of increasing uncertainty. as realized loss This indicates that many investors are closing positions below their cost basis.
According to the data, it now has realized losses of $611 million on a profit of $346 million, resulting in a weekly net profit or loss (PnL) of -$264 million. This pattern often appears during major corrections, when the most extreme sell-off begins to wane, but the market is still processing the effects of the recent decline.
Although the market remains in negative territory, this divergence in earnings highlights a clear improvement in the situation. On February 7, Darkforst highlighted that its average weekly profit and loss remained at around $2 billion, indicating a clear capitulation as the Bitcoin price fell below the $60,000 level.
Amid these market trends, Short-term BTC holder They have always been the most active players in this sector. These investors currently hold a larger share of supply than during the bear market, putting Bitcoin in a vulnerable phase.
In January 2023, Bitcoin supply The number of investors classified as short-term holders was 12% and is now 22%, representing a doubling of growth. At this point, it is important that BTC’s momentum continues and is maintained. This modicum of resilience has strengthened holding sentiment and accumulation among many investors, which is fueling the current stock price consolidation. On the other hand, it would be a clear improvement to see the bottom line return to positive territory after more than four months of losses and humiliation.
Funding rate is showing a negative trend
While Bitcoin has struggled to regain its upward trajectory, certain areas appear to be rebounding in value for the asset. For example, the BTC funding rate is showing bearish movement. CW is a data analyst and cryptocurrency investor. highlighted Most of the range when the BTC perpetual futures funding rate fell to negative values was at the bottom of the rate. short term decline.
CW then outlined an overall upward trend, with no confirmed declines yet. Currently, funding rates are once again in negative territory, meaning that current prices are short-term. BTC bottom.
Featured image from Pngtree, Chart from Tradingview.com
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