The recent selling pressure on Bitcoin (BTC) price may not end soon, as indicated by the profitability stress ratio.
According to data from the leading onchain data platform Glassnode, the ratio has been at its highest since September 2024.
However, the price of BTC appears bright, with slight improvements on the daily chart. The Bitcoin Exchange-Traded Funds (ETFs) also saw inflows after days of persistent outflows.
Implication of the Bitcoin Profitability Stress Ratio
Glassnode data shows the Bitcoin profitability stress ratio surged to 0.23, marking a 6-month high. This metric measures the relative size of supply in a loss state, suggesting market pressure conditions.
Historically, this metric above 0.2 has often suggested periods of intensified market pressure.
Thus, a further rise of the metric above 0.23 could suggest further increases in market pressure, potentially reinforcing a broader shift in sentiment.
However, several market analysts think the value of the stress ratio presents unique opportunities for buyers.
Their opinion is based on the fact that this stress ratio often precedes major Bitcoin rally.
Moreover, the current market setup shows long-term holders accumulating while weak hands capitulate. Large investors’ accumulation of Bitcoin indicates their confidence in the coin’s future movement.
Still, Bitcoin may continue to experience volatility, as seen in the BTC Volatility Index (VI). This index hit a six-month high of 2.75%, showing Bitcoin’s unstable outlook.
The ongoing BTC volatility is attributed to macroeconomic factors like interest rates, inflation, and the Donald Trump-triggered trade war.
While many have raised concerns that Bitcoin has entered a bear market, CryptoQuant CEO Ki Young Ju thinks it is too early to determine that.
Bitcoin Accumulation Trend Score and Impact
Glassnode also outlined another persistent trend in Bitcoin’s market dynamics and sentiment. As Bitcoin price moves sideways, the platform highlighted that accumulation has remained substantially high.
Glassnode pointed to the positioning of Bitcoin’s Accumulation Trend Score metric, consistently above 0.1.
This metric signals that large-scale accumulation among investors is relatively high despite recent price fluctuations.
Specifically, the metrics monitor the level of Bitcoin accumulation by large market players. It provides insight into market participants’ balance size and accumulation behavior over the last month.
With whales and long-term investors showing aggressive buying pressure, BTC could recover to key levels.
Bitcoin Price and Key Trends to Watch
Bitcoin’s price was trading for $84,552, up 1.14% in the last 24 hours and 8.8% over the last seven days. The daily trading volume increased by over 48% to $26.6 billion, signaling rising investor activity.
Still, Bitcoin is far below support and resistance levels on the bigger timeframe. Market analysts think the ongoing sideways trading in the range of $82,000 to $84,000 may likely continue.
Crypto analyst Gambardello revealed that BTC has reached “escape velocity.”
The analyst pointed to a combination of on-chain metrics, institutional interest, and technical patterns, suggesting the crypto market is approaching a major bull phase.
Meanwhile, interest in the spot Bitcoin ETFs has grown compared to weeks of outflows.
According to Farside Investors data, the BTC spot ETF market saw minor inflows of $41.3 million.
Ark Invests’ ARKB recorded the highest inflows of $100.5 million, followed by Bitwise’s BITB with $23 million. However, BlackRock’s IBIT saw outflows of $96.2 million.
