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Home Bitcoin

BTC surges by 9.92% but market remains bearish

September 16, 2024
in Bitcoin
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BTC surges by 9.92% but market remains bearish
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  • BTC has surged by 9.92% over the past seven days, but fell again at press time.
  • Despite the surge, BTC remains in a bearish market especially with declining transaction volume.

Over the last week, Bitcoin [BTC] has made a recovery returning to the $60k level temporarily.

Since hitting local lows a week ago, Bitcoin attempted to maintain an upward momentum, but failed as it fell below $60k again. On the upside, the prevailing market conditions have analysts talking.

Popular crypto analyst Ali Martinez suggested that a trend reversal was not complete citing Bitcoin’s transaction volume.

Prevailing market sentiment

In his analysis, Martinez cited the declining trading volume which suggests a trend reversal hasn’t occurred.

Source: X

According to this analysis, during uptrends, BTC transaction volume tends to increase and decrease during a downtrend. Thus, since, the current condition sees declining trading volume, the market is still in a downtrend.

In context, during a price uptrend, transaction volume increases because more investors are actively buying and selling resulting in higher market activity.

Thus, an increase in volume usually confirms the strength of an uptrend, as more investors are actively engaged in the market.

Subsequently, when markets are in a downtrend, volume reduces. A lower volume suggests fewer market participants. This suggests that the bearish market sentiment is still in play.

As Martinez notes, Bitcoin trading volume has declined by 58.66% over the past day. Therefore, based on this analysis, BTC is still in a bearish market.

What BTC charts suggest

As noted by Martinez, although BTC has tried to break out, bears are still dominating the market. Therefore, the current market conditions could set Bitcoin for a decline.

Source: Cryptoquant

For example, Bitcoin’s fund flow ratio has declined over the past week. This implies there’s less buying activity compared to selling which means few investors are injecting their funds into the market.

See also  Bitcoin's correlation with Wall Street rises: Good news or bad?

This is a bearish market sentiment as investors are closing their positions contributing to downward price pressure.

Source: Cryptoquant

Additionally, Bitcoin’s net realized profit/loss has declined over the past 2 days after spiking the previous days. A decline in NRPL implies investors are selling at a loss.

Source: Santiment

This suggests that there is reduced demand for BTC as fewer buyers are willing to purchase at higher prices or there’s less trading activity.

Finally, Bitcoin’s price DAA divergence has remained over the last week. A negative DAA divergence means Bitcoin prices are rising while daily active addresses decline.


Read Bitcoin’s [BTC] Price Prediction 2024–2025


This suggests that while the prices are rising, the fundamental usage of the network is not catching up. This is bearish as the price rise is a mere speculative rally.

Simply put, as Martinez notes, Bitcoin is still in the bearish trend. Thus, if this negative market sentiment holds, BTC risks a decline to $57342.

Next: SUNDOG sees big players bet $2.5M: What’s Next?

READ ALSO

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  • BTC has surged by 9.92% over the past seven days, but fell again at press time.
  • Despite the surge, BTC remains in a bearish market especially with declining transaction volume.

Over the last week, Bitcoin [BTC] has made a recovery returning to the $60k level temporarily.

Since hitting local lows a week ago, Bitcoin attempted to maintain an upward momentum, but failed as it fell below $60k again. On the upside, the prevailing market conditions have analysts talking.

See also  Bitcoin whales load up as BTC stays still at $66k: What's their strategy?

Popular crypto analyst Ali Martinez suggested that a trend reversal was not complete citing Bitcoin’s transaction volume.

Prevailing market sentiment

In his analysis, Martinez cited the declining trading volume which suggests a trend reversal hasn’t occurred.

Source: X

According to this analysis, during uptrends, BTC transaction volume tends to increase and decrease during a downtrend. Thus, since, the current condition sees declining trading volume, the market is still in a downtrend.

In context, during a price uptrend, transaction volume increases because more investors are actively buying and selling resulting in higher market activity.

Thus, an increase in volume usually confirms the strength of an uptrend, as more investors are actively engaged in the market.

Subsequently, when markets are in a downtrend, volume reduces. A lower volume suggests fewer market participants. This suggests that the bearish market sentiment is still in play.

As Martinez notes, Bitcoin trading volume has declined by 58.66% over the past day. Therefore, based on this analysis, BTC is still in a bearish market.

What BTC charts suggest

As noted by Martinez, although BTC has tried to break out, bears are still dominating the market. Therefore, the current market conditions could set Bitcoin for a decline.

Source: Cryptoquant

For example, Bitcoin’s fund flow ratio has declined over the past week. This implies there’s less buying activity compared to selling which means few investors are injecting their funds into the market.

This is a bearish market sentiment as investors are closing their positions contributing to downward price pressure.

Source: Cryptoquant

Additionally, Bitcoin’s net realized profit/loss has declined over the past 2 days after spiking the previous days. A decline in NRPL implies investors are selling at a loss.

Source: Santiment

This suggests that there is reduced demand for BTC as fewer buyers are willing to purchase at higher prices or there’s less trading activity.

See also  Is Bitcoin's run to $73K sustainable? $40M in liquidations suggests...

Finally, Bitcoin’s price DAA divergence has remained over the last week. A negative DAA divergence means Bitcoin prices are rising while daily active addresses decline.


Read Bitcoin’s [BTC] Price Prediction 2024–2025


This suggests that while the prices are rising, the fundamental usage of the network is not catching up. This is bearish as the price rise is a mere speculative rally.

Simply put, as Martinez notes, Bitcoin is still in the bearish trend. Thus, if this negative market sentiment holds, BTC risks a decline to $57342.

Next: SUNDOG sees big players bet $2.5M: What’s Next?
Tags: BearishBTCmarketRemainssurges

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