BTC Week 51 Observation: Gaining Market Equilibrium Insights from the Pullback

Multiple Signals Behind Price Adjustment

Bitcoin has retreated from the high of $94,000 to $92.14K, reflecting a market entering a cautious consolidation phase. The 14-day RSI has returned to the neutral zone, indicating the short-term overbought momentum is waning, but this is not a panic signal; rather, a natural technical correction. Spot trading volume continues to shrink to low levels, combined with the CVD indicator plunging into negative territory, revealing that selling pressure is gradually accumulating.

True Intentions Revealed by the Derivatives Market

A slight decline in open interest in futures contracts indicates that there is no widespread panic liquidation in the market, and risk-off behavior remains moderate. However, the perpetual contract CVD falling below the lower limit suggests that bears are brewing strength. Notably, despite the price decline, funding rates have risen, indicating that bullish positions remain resilient. But if the weak trend continues, these positions face significant risk.

The options market remains stable, with open interest holding steady, and the volatility spread showing negative values and increasing skewness, reflecting traders’ ongoing defensive stance against downside risks.

Contradictory On-Chain Data

Active addresses have slightly decreased, yet this contrasts with the transfer volume surpassing upper limits—implying that although the number of participants has decreased, capital flow volume has significantly increased. The easing of fee pressure confirms a decline in on-chain space demand. Regarding supply dynamics, the influence of short-term holders is rising, and the proportion of hot money is increasing, leading to heightened market sensitivity to volatility.

ETF Inflows Continue to Provide Support

Despite shrinking trading volume, net inflows into spot ETFs remain strong, offering some institutional support. However, the ETF MVRV indicator has fallen back, and profit metrics are subdued, indicating that market sentiment remains cautious with no signs of excessive optimism.

Market Pattern Analysis

Bitcoin is currently in a risk-averse consolidation phase. Some indicators reveal underlying activity and institutional interest, but overall confidence is unevenly distributed. Without stronger demand-driven momentum, the market is vulnerable to downward pressure and may fall into a prolonged range-bound oscillation. The key moving forward is whether the market can rebuild upward momentum or continue testing support below 94K.