Despite the numerous volatility out there, Bitcoin has managed to take care of its position above $80,000 support because it recovered the value level over per week ago. As BTC’s price undergoes a persistent bearish movement, its market dynamics look like changing toward a latest price territory.
An Adjustment In Bitcoin’s Market Trend
Bitcoin has faced significant price fluctuations, but market dynamics are undergoing a notable change that might be crucial within the asset’s next trajectory. Glassnode, a world-leading financial and on-chain data platform revealed the shift in market trends in a recent X post.
The most recent data from the on-chain platform shows that the BTC market continues to be adjusting to its latest price range. This persistent move comes after the flagship asset’s notable correction of about -30%, signaling a period of stabilization.
A stabilization of BTC’s price suggests that momentum is constructing for its next major move. Nevertheless, a breakdown could still occur, triggering renewed selling pressure amongst investors and traders if Bitcoin fails to take care of key support levels.
Glassnode highlighted that liquidity conditions are presently experiencing a decline within the on-chain and future markets. As the value continues to swing, BTC’s next major move stays uncertain, with the market unclear as as to if it’s in a robust overbought or oversold zone.
Moreover, the platform has pointed to a concerning trend amongst Bitcoin long-term holders amid waning market conditions. In accordance with Glassnode, long-term BTC holders are still dormant, which supports the notion of a slow market and sideways price performance.
A Deleveraging Of The BTC Market
The slow market can be reflected by a considerable drop in BTC’s Open Interest (OI) in a period of two weeks. On-chain and technical expert Darkfost reported that just about $10 billion in open interest was lost between February 20 and March 4.
This decline in open interest is reminiscent of the previous drop in a period of two months. It’s value noting that Bitcoin’s open interest has fallen because it hit an all-time high of over $33 billion on January 17, reflecting its highest level of leverage out there.
Nevertheless, there was a big liquidation of leverage following the recent panic attributable to political instability because of US President Donald Trump’s motion. Thus Darkfost claims that the BTC market is deleveraging.
While the event raises serious concerns, the expert noted that it’s a needed stage for maintaining a bullish continuation and could be considered a natural market reset. The Aggregated Open Interest metric illustrates these reset stages by highlighting times when the 90-day open interest change is negative. Meanwhile, the open interest change for 90-day Bitcoin futures has plummeted to -14%.
Featured image from Unsplash, chart from Tradingview.com
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