Bitcoin (BTC) Market Analysis: Fragility Amid Macro Shocks

Bitcoin (BTC) remains under significant pressure, with weak fundamentals and macroeconomic instability posing challenges, according to Glassnode. Despite these challenges, the cryptocurrency shows resilience around the $80,000 mark, indicating potential defense by long-term holders.

Market Overview

The Bitcoin market continues to navigate through volatility, as evidenced by a sharp sell-off followed by a rebound to $82,000. The Relative Strength Index (RSI) remains below its statistical low, hinting at a potential breakout from the current consolidation range. The spot Cumulative Volume Delta (CVD) has fallen further to -$167 million, highlighting ongoing sell-side pressure. Although spot trading volume surged past $12 billion, it seems driven by reactive selling rather than new demand.

In the derivatives market, a multi-month downtrend persists, with open interest declining to $33.94 billion. Funding rates have slightly increased to $1.11 million per day. Meanwhile, the Perpetual CVD has dropped sharply to -$594 million, suggesting significant taker-driven sell pressure and liquidations. In the options market, volatility expectations have rebounded, and while open interest remains subdued at $21.77 billion, the volatility spread has turned positive at +0.18. The 25 Delta Skew remains elevated at 0.08, indicating strong hedging activity.

ETF and On-Chain Signals

Exchange-traded fund (ETF) flows have turned negative once more, with a decline of $297 million, although weekly trading volume soared to $22.45 billion amid increased volatility. The ETF Market Value to Realized Value (MVRV) ratio slipped to 1.23, slightly below its statistical band, suggesting ETF holders are testing cost basis levels near $80,000.

On-chain fundamentals remain weak, with active addresses and transfer volumes showing little strength, and fee volume declining to $458,000 per day, indicating low blockspace demand. Liquidity inflows remain subdued, with realized cap growth slowing to 0.80% per month. Short-term supply is gradually maturing into long-term holdings, while speculative activity declines, as evidenced by the Hot Capital Share dropping below statistical lows. Profitability metrics are also on a downtrend, with the Percent Supply in Profit at 76%, Net Unrealized Profit/Loss (NUPL) at 0.45, and the Realized Profit/Loss Ratio at 0.21.

Overall, Bitcoins market position is fragile due to weak fundamentals, declining profitability, and soft liquidity, making it susceptible to macroeconomic shocks. Nonetheless, the price resilience around $80,000 may be a constructive signal if broader market conditions stabilize.