Bitcoin (BTC) is showing signs of weakness, according to on-chain data. CryptoQuant CEO Ki Young Ju, in a series of tweets, noted that the realized cap for long-term holders (LTHs) has been steadily declining, suggesting a potential bearish signal.
Ju also highlighted the realized cap for short-term holders (STHs), which has also seen a downward trend.
This could indicate that short-term holders are selling their BTC at a loss, further contributing to the bearish sentiment.
The decline in realized cap for both LTHs and STHs, coupled with the recent drop in price, could signal a potential shift in market dynamics. However, it’s important to note that on-chain data is not always a reliable indicator of future price movements.
On the other hand, the Bitcoin supply in profit market bands seems to be holding up, with a substantial amount of BTC still remaining in profit.
This could suggest that the market is not yet in a full-blown bear market.
Despite the mixed on-chain signals, the technical outlook for Bitcoin remains bearish. The 4-hour chart shows a clear downtrend, with the price currently trading below both the 20 and 50 moving averages.
This suggests that further downside is likely in the near term.
However, it’s still too early to say whether the current correction is a temporary dip or the start of a larger bear market. Investors should closely monitor on-chain data and technical indicators to assess the market’s direction.
