Glassnode Announces Bitcoin Has Entered a “Deep Bear Phase” – But There Is Still Positive News

Glassnode, which provides onchain analysis of the cryptocurrency market, said in its new report that the market has ‘deep bear’ phase but extreme panic selling has not yet been reported.

According to the company, the current situation points more to a bubble bursting process.

Glassnode’s analysis shared on social media has suggested that the ‘in-chain signs seen by investors during last year’, as well as in their Halloween period, indicated a potential bear market. Bitcoin prices dropped from $110,000 to $60,000 in the roughly 100 days after these signals and a drop of about half-way through bitcoin, down by around 45%.

The report contains the Long-Term Investor Profit-Taking Pressure data showing that long term investors have taken about 318,000 BTC in additional profits since November 1st. This unusually large sell-off, which has been in a weak market environment, continues to pressure the price down. However, the fact that long-term investors’ total assets have been starting to reappear since early December is a sign of slack in selling at.

The Market Loss Level metric estimates that loss ratio has reached about 24% at the $60,000 price level according to the market losses. Compared to bull-bear transition threshold, this ratio is much above the bull–bead transition limit. But, Glassnode notes that in the past extreme panic selling has often led to loss ratios of more than half (advanced by Xion), so it is not yet at this stage where the market reached “capitulation” levels. It is also a process that is progressing as ‘bubbles of bubbles, not an extreme collapse and the process itself being “blitzed” by this .

Conversely, since October’s peak, the price has not been above the cost basis of the top 1%, 5 percent and 10% investor groups. Approximately 37% of the price is about $95,000, or less than cost basis for the top 20% investor group at $60,000 level. This suggests deep psychological pressure on investors who bought at high levels, and the market structure is said to be similar as that of May 2022 period.

*This is not investment advice.

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