-
Fewer active addresses and lower transactions suggest traders are in a wait-and-watch mode.
-
Early-week price moves can mislead traders, often reversing by week’s end.
-
Rising global liquidity may fuel Bitcoin’s next big rebound once market pressures ease.
Bitcoin traders face renewed caution as on-chain and market signals confirm the cryptocurrency remains in a bear market. Analysts report declining network activity, reduced speculative engagement, and defensive positioning among major holders, suggesting low activity may soon precede increased volatility.
According to CryptoQuant analyst GugaOnChain, the BTC: Bull-Bear Cycle indicator, alongside the 30-day moving average (MA_30D) sitting below the 365-day moving average (MA_365D) at -0.52%, confirms that bearish conditions dominate the market.
GugaOnChain highlights the BTC: Highly Active Address metric, which fell from 43.3K to 41.5K, reflecting fewer active traders and institutions. “Historically, when highly active addresses shrink, it signals retreat by traders and institutions, reinforcing the transition into quiet accumulation phases that precede future volatility,” he noted. Transaction counts also dropped from approximately 460K to 438K, while fees declined slightly from $233K to $230K, further indicating reduced speculative activity.
Network Activity Mirrors Past Bear Cycles
The current downturn is similar to those observed in the bear market of 2018. Sharp market swings back then were foreshadowed by fewer active addresses, fewer transactions, and decreasing fees. Despite the low engagement, the user base currently is above 800K, compared to over 600K in 2018, demonstrating structural resilience.
Hence, while the market behaves cautiously, broader adoption may mitigate extreme swings. Moreover, this accumulation phase could lay the groundwork for significant price movements once new catalysts emerge.
Analyst Ardi emphasizes market mechanics in the first two days of the week, pointing to Monday and Tuesday as crucial for gauging BTC’s weekly price action. He explains, “Early in the week, price expands forcefully in one direction, convincing traders that direction has been established. Liquidity builds as stops are triggered and breakout traders commit. As the week progresses, price resolves in the opposite direction and closes on the opposite side of the Weekly Open.” Consequently, traders relying on early-week trends risk falling into directional traps.
Liquidity and Macro Factors Influence BTC
Daan Crypto Trades notes rising global liquidity, fueled by central banks’ expanding balance sheets. He observes, “$BTC is fighting its own fight currently with the 4 year cycle and OG whale selling happening. Once that clears up, I am curious to see how long some type of catch up trade will occur.” Additionally, increasing liquidity could provide BTC with the fuel needed for a recovery or sharp rebound.
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
ARK Invest Releases Bitcoin Quantum Risk Five-Stage Chart, Q-Day Threats Need Not Cause Panic
ARK Invest and Unchained Release White Paper Analyzing Progressive Quantum Computing Threat to Bitcoin, Proposing Five-Stage Framework. The report emphasizes that despite technological advances, the current Bitcoin network is not yet under threat, and the community should proactively deploy quantum-resistant security measures to address potential future risks.
GateNews6m ago
Iran warns that oil prices could soar to $200, and Bitcoin faces a new wave of volatility risk
Iran warns that if the US and Israel continue military actions, oil prices could soar to $200, potentially intensifying inflation and affecting the Bitcoin market. Although Bitcoin has recently rebounded, geopolitical conflicts have caused its performance to remain unstable, and analysts indicate that there may be significant fluctuations in the future, so investors should stay alert to potential risks.
GateNews8m ago
A certain whale is continuously averaging down on 40x leveraged BTC short positions, with accumulated holdings of $3.12 million
On March 12, Hyperinsight detected an address continuously increasing BTC short positions, with cumulative holdings reaching $3.12 million despite currently being down 16%. The address has set take-profit orders, planning to close positions in batches within the $69,200 to $69,450 range.
GateNews9m ago
India Arrests Core Suspects in GainBitcoin, Cryptocurrency Ponzi Scheme Investigation Escalates
On March 12, India's Central Bureau of Investigation arrested Ayush Varshney, Chief Technology Officer of Darwin Labs, on suspicion of involvement in the GainBitcoin cryptocurrency Ponzi scheme. The case involves a wide range of investors and substantial fund misappropriation, with investigations revealing that the fraudsters utilized complex technical platforms and smart contracts to conceal their activities. This arrest marks intensified efforts by Indian regulators to crack down on crypto fraud.
GateNews9m ago
Trump announces "Victory in Iran War," Bitcoin surges strongly back to $70,000, Ethereum rises in tandem
Trump announces that the U.S. military has achieved victory in the military operation against Iran, improving risk sentiment in the financial markets, and cryptocurrencies rebound. Bitcoin rises over 5% to re-enter the $70,000 level, with Ethereum and other digital currencies also recovering. Currently, the market is focused on the stability of the Middle East situation and international oil prices, which have a significant impact on Bitcoin's future trend.
GateNews16m ago
Strive buys Strategy stocks, and Bitcoin Treasury Company begins to intertwine with each other.
Strive has recently increased its Bitcoin holdings by 179 coins, bringing the total to 13,311 coins, and invested $50 million in the preferred stock STRC of Strategy. This series of investments shows that both companies are raising funds through bond issuance and continuing to increase their Bitcoin positions. However, this funding chain structure concentrates risk on Bitcoin, forming a complex "matryoshka" financing model. As interest rates rise, investors face increasing difficulties, and the market becomes more concentrated.
PANews18m ago
