Cautious Recovery Signals in Bitcoin

Bitcoin (BTC) has entered a sharp risk reduction process in the markets, declining from 115 thousand dollars to 104 thousand dollars over the past week. Following this drop, the price of Bitcoin showed a recovery back to 111 thousand dollars, but this process continued to keep investors in a defensive mindset.

According to the latest data from Glassnode, it is noted that the market has been purged of "weak hands" following this sharp decline. However, it is emphasized that confidence has not fully returned, and investors are still in search of direction. While momentum indicators are weakening, there are warnings that selling pressure in the markets continues. Additionally, while the RSI index is trying to recover from the oversold zone, the cumulative volume delta (CVD) continues its negative trend, which is noteworthy.

With the market volatility, a significant decrease in the open position amount in futures trading has been observed, and the decline in funding rates shows that investors are avoiding risk. In the options market, the increased demand for downside protection has caused a sharp rise in the 25-delta curve.

The increase in the share of short-term investors indicates that speculative movements have increased, while the Net Unrealized Profit/Loss ratio has turned negative and the Realized Profit/Loss ratio has dropped to the lower band. On the other hand, the continued rise in Bitcoin’s “Realized Cap” metric indicates that long-term investors are still buying.

According to analysts, although the market has been purged of excessive leverage, it still possesses a fragile structure. Glassnode states, “The market has regained balance, but a cautious trajectory may be maintained until confidence returns.” In this context, critical points that investors should pay attention to will be the enhancement of market reliability and the sustainability of potential recoveries.