Bitcoin (BTC) could be facing a period of sideways movement or further correction, according to on-chain metrics analyzed by Glassnode, a leading crypto analytics firm. The firm points out that BTC’s short-term demand momentum has weakened significantly, indicating a potential shift in market sentiment.
One key indicator highlighted by Glassnode is the substantial decrease in Hot Capital, which has dropped by 66.7% from its peak of $96.2 billion on December 12th to $32.0 billion. This decline suggests a significant reduction in buying pressure within the market.
Additionally, Glassnode observes that BTC’s exchange volume momentum has been diminishing, approaching levels close to the 365-day average. This trend reflects a decrease in capital flows since the peak of the market in December. Furthermore, the funding rates from the top three perpetual markets remain below the neutral value of 0.01%, indicating a lack of demand from aggressive buyers despite a short rally towards $102,000.
In light of these metrics, Glassnode suggests that without a new catalyst, the dwindling short-term demand could lead to either a period of sideways consolidation or an increased likelihood of further correction in the market.
As of the time of writing, Bitcoin is trading at $92,579, down nearly 3% in the past 24 hours and more than 4% in the past seven days. The cryptocurrency remains over 14% below its all-time high of $108,135, which was reached in December.
To stay updated on the latest market trends and price action, subscribers can sign up to receive email alerts directly to their inbox. For real-time updates, users can also follow Glassnode on social media platforms such as X, Facebook, and Telegram.
In conclusion, Glassnode’s analysis suggests a potential shift in market dynamics for Bitcoin, with indications pointing towards a period of consolidation or further correction in the near future. As always, it is essential for investors to stay informed and monitor developments in the cryptocurrency market to make well-informed decisions.