The Bitcoin and cryptocurrency markets are retreating from the seven-week highs reached over the weekend, and activity on the chain indicates that the bears still have a lot of energy.
About $ 50 billion has left the crypto asset space since the weekend. Markets are in retreat this week, with total market cap dipping below $ 1.100 trillion yesterday.
After the big slump in mid-June, the cryptocurrency markets have had an up and down trend, with resistance too strong to overcome. On-chain analytics provider Glassnode reported that bears are still firmly in control of the market.
Bear rescue rally
According to Glassnode, who analyzed data from the Bitcoin network (quotation BTC) in its weekly report, "current network activity suggests that the influx of new demand is still low".
The company analyzed network transactions, address activity, and fees, which are usually a good indicator of the demand for Bitcoin and its siblings.
He noted that despite the recent rally to $ 24K, these trends are on the decline, indicating that we are "firmly in bear market territory". Bitcoin is currently trading at $ 22.880, right on the 200-week moving average. This indicator has been the bottom of the market and solid support in the previous two bear markets, even though prices have fallen below it.
Another underlying market indicator is the Realized Price, which measures the value of all coins in circulation at the price of the last move, or an approximation of how much the entire market has paid for their coins. The realized price of BTC is currently $ 21.807, according to charting site Woo Charts.
Looking at the last month of consolidation, Glassnode said there was only a "stable base of more convinced traders and investors" left. These have slowly accumulated, but there hasn't been a new demand that has pushed prices up.
Considering the current state of the global economy, this scenario is likely to persist for some time. Only when inflation is under control and traders and retail investors have more liquidity for high-risk assets will the demand for cryptocurrencies increase.
Cooling of cryptocurrencies
Markets are retreating from the weekend's seven-week highs. Bitcoin is flat, although Ethereum (ETH) gained marginally 2,6%, topping $ 1.600 in Wednesday morning's Asian session. Solana (SOL) recorded the largest decline, equal to 4%, due to the news of an attack on the ecosystem.
