Losses in the Bitcoin Market May Signal a Turnaround

In recent days, the movements in Bitcoin prices have raised significant concerns among investors. The rapid loss realization by short-term investors may indicate that the market is nearing the end of its decline phase. CryptoQuant analysts report that, based on current data, a quite severe short-term capitulation period for Bitcoin is ongoing.

Analysts emphasize that the losses reflected in the data regarding Bitcoin indicate a cyclical correction rather than the start of a new decline. The STH SOPR metric, which shows the behavior of short-term investors, has dropped to approximately 0.97, entering the loss zone again. This ratio has been below 1.0 for weeks, indicating that the market is stuck in a capitulation band.

Historical data shows that investors generally tend to panic sell in this zone, and this is often not a conscious decision but fear-based. Similarly, the STH MVRV has dropped well below the 1.0 level. This situation indicates that almost all investors who bought recently are at a loss. This rare and deep loss environment in the data set is causing the selling pressure to rapidly tighten as a significant portion of weak investors exit their positions.

While fear dominates the markets, another important data shared by the CryptoQuant analyst is the 65,200 Bitcoin transferred to exchanges at a loss. This volume shows that the fear is not just a potential risk but has actually turned into realized losses. The process aligns perfectly with a classic capitulation model. First, unrealized losses increase, then panic selling accelerates, and the selling pressure becomes unsustainable. Finally, strong investors start to accumulate supply.

CryptoQuant analysts note that while the current market conditions do not guarantee a sudden rise, the fundamental conditions observed before cyclical recoveries are increasingly overlapping. The STH losses being at historical levels, the SOPR value remaining permanently below 1.0, the intense stress on the MVRV, and fear-motivated entries into exchanges indicate that recovery signals are beginning to accumulate. Analysts emphasize that volatility may continue, but the weak hands have largely been purged, which historically points to the final stages of decline periods.