Glassnode Ignited New Rally Signal in Bitcoin: What's the Situation with Sellers? Are They Exhausted? - Coin Bulletin

Glassnode data indicates that with Bitcoin dropping to $99,000, investors are experiencing significant unrealized losses and capitulation is beginning to occur in the market.

According to the report released today by Glassnode, Bitcoin price fell to $99,000 after experiencing Seller Exhaustion Composite (Seller Exhaustion Composite). This signal indicates that investors are experiencing significant unrealized losses and that a capitulation process is taking place across the market.

Seller exhaustion in Bitcoin usually occurs after significant price corrections, indicating a potential market recovery as selling pressure diminishes, according to Glassnode's analysis. While short-term investors often suffer major losses, this situation can generally be a sign that the market is approaching a bottom.

(# The role of short-term and long-term investors

In Bitcoin bull markets, long-term investors usually remain profitable with )LTH###, while short-term investors stand out as a group experiencing significant losses during market downturns with (STH). Glassnode uses the following three key metrics to analyze this situation:

• MVRV Ratio: Measures the average profit or loss level of investors' current Bitcoin holdings compared to the current price.
• SOPR (Spent Output Profit Ratio): Determines whether investors made a profit or a loss when selling.
• Realized Loss (: It represents the total value lost in US dollars.

)# Daily and weekly-monthly investor analysis

Glassnode examines investors by dividing them into two main groups to detect seller exhaustion:

Daily Traders (24 Hourly Period)

This group includes investors who react to Bitcoin's price movements the fastest. Glassnode analyzes the losses of this group using the MVRV Z-Score and identifies the points where selling pressure is most intense. This metric usually has high fluctuations, reflecting short-term panic selling in the market.

Weekly-Monthly Traders ###1 Day-1 Month Period(

This group, which includes longer-term investors, is less affected by market movements. However, when price fluctuations reach a certain level, these investors also turn to selling. Glassnode indicates that the selling pressure of this group spreads losses over time to larger investor groups using MVRV Z-Score and SOPR ratios.

According to Glassnode's analysis, seller exhaustion points in the Bitcoin market typically emerge after major price drops and indicate that the market could reach a balance again. Sudden sales by daily investors increase short-term fluctuations in the market, while when analyzed over longer time periods, these fluctuations point to less common but more decisive turning points.