Bitcoin has reclaimed the $63,000 level after adding 2.5% to its value in the last 24 hours. However, the rally could be short-lived amid declining institutional and retail participation.
New investors are increasingly sitting on unrealized losses, according to a Glassnode report published Wednesday.
The data suggests that Bitcoin’s rally last month may now be viewed as a “bear bounce,” rather than the start of a sustained recovery.
Key onchain metric signals persistent weakness
Glassnode, a leading on-chain data analytics company in the cryptocurrency market, published its weekly report on Wednesday, citing the persistent weakness in the crypto market.
Glassnode pointed to the AVIV Ratio, which compares Bitcoin’s spot price to its True Market Mean, as a key indicator of ongoing stress.
The metric fell to a four-year z-score low of -1.09, before slightly recovering to -1.06.
The firm said this suggests sentiment remains fragile.
“The fact that price has not bounced meaningfully away from this cyclical low over the past week underscores the persistence of fear in current market sentiment,” Glassnode noted.
Recent buyers have been hit hardest by the downturn.
The Short-Term Holder Market Value to Realized Value (STH-MVRV) ratio dropped to 0.81, later recovering slightly to 0.83, meaning short-term investors are still approximately 17%–19% underwater on average.
Glassnode also highlighted that coins accumulated in the $78,000–$82,000 range are now largely held at a loss.
Market stress is especially visible among newer participants. The report noted that short-term holder supply in profit fell to 0.6%, later rising to 3.3%, which is far below the four-year average of 55%
Glassnode warned that more than 95% of the recent buyer cohort is currently underwater.
Overall, Glassnode said the market appears to be moving deeper into a capitulation phase.
It added that while leverage has largely reset and valuation indicators have reached historically low levels, the demand response typically associated with long-term market bottoms has not yet emerged.
Institutional participation in the market also remains weak.
Data obtained from CoinGlass’s ETF page shows that spot Bitcoin ETFs recorded an outflow of $213 million on Wednesday, extending the losing streak to four days.
This indicates that institutional buyers have not stepped in to absorb selling pressure in the current downturn.
Bitcoin holds above $62K amid volatility
The BTC/USD 4-hour chart remains bearish despite Bitcoin adding 2.5% to its value in the last 24 hours.
Onchain signals from both Glassnode and CryptoQuant suggest the market remains in a fragile, demand-constrained phase, with investors still absorbing losses from recent price declines.
The momentum indicators remained mixed. The RSI of 53 is above the neutral 50, indicating a fading bearish momentum.
However, the MACD lines are within the negative territory, suggesting that the buyers have not regained control yet.
If the market recovery continues, BTC could surge towards the 4-hour Transactional Liquidity (TLQ) at $64,712.
A daily candle close above this level could pave the way for BTC to extend its rally towards the $68,000 zone.
However, if the recovery fails, Bitcoin will likely retest the Tuesday low of $60,351, with another major demand zone at $59,106 also a target.
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