Bitcoin($BTC), still has further downside potential... Short-term holders' loss rate has not yet reached the "low point signal"

Bitcoin (BTC) prices have recently experienced a downward trend, and debates among investors about whether the bottom is near or if there is further room to fall are intensifying. Based on comprehensive on-chain indicators and derivatives market trends, the possibility of further adjustments in the short term cannot be ruled out.

Crypto analyst Ali Martinez emphasized on Twitter that the realized loss rate of “short-term holders” is a useful indicator for capturing Bitcoin bottoms. He explained that in the past, when this indicator fell below -37%, it signaled strong buying opportunities, but currently it remains at -18%. This suggests that the market has not yet experienced enough pain.

This indicator tracks Bitcoin held for 1 to 3 months, with the average loss rate around 18% (as of December 8). The realized price of Bitcoin is about $112,300 (approximately 165.05 million KRW), but the current market price trades around $90,400 (approximately 132.95 million KRW), which is interpreted as many investors still being in a loss zone.

Looking back at past market bottoms, records show that in early 2020, mid-2022, and late 2023, the loss indicator dipped below -37%, followed by market rebounds. However, in this cycle, such extreme loss levels have not yet been reached, indicating the potential for further declines.

After the Federal Reserve’s December rate cut, Bitcoin has shown a downward trend. Although Chairman Jerome Powell mentioned the possibility of further rate cuts in 2026, the market has responded with unease. Over the past week, Bitcoin has fallen more than 3%, with a single-day drop exceeding 2%. In the last 24 hours, prices fluctuated between $89,623 (about 131.74 million KRW) and $94,177 (about 138.54 million KRW), showing high volatility.

Technical indicators also suggest bearish signals. Although CME futures briefly broke above the long-term downtrend line, there was a retest of that zone. Additionally, the 50-day moving average has crossed below the 200-day moving average for the first time, forming a “death cross,” raising concerns about a potential bearish reversal. This is the first death cross on CME futures benchmarks since 2022.

However, it is worth noting that the current range has not yet established a clear direction. Analyst CRYPTOWZRD mentioned that a break above and stabilization at $94,000 could signal a bullish reversal. Conversely, if it falls below $89,250, the bearish trend may intensify.

Currently, traders are acting cautiously within a narrow price range, remaining on the sidelines until a strong trend is confirmed. In particular, open interest in Bitcoin futures has sharply decreased from $475 billion (about 69.87 trillion KRW) two months ago to $275 billion (about 40.45 trillion KRW), which is believed to reduce overall market risk exposure.

Summary by TokenPost.ai

🔎 Market Interpretation

Bitcoin is approaching the oversold zone but has not yet reached the loss levels seen at past bottoms. Caution is still advised in this range.

💡 Strategy Highlights

• Downside risk remains until the average loss rate of short-term holders approaches -37%

• Watch for a potential break below $89,250; a reversal depends on breaking above $94,000

• The sharp decline in open interest suggests short-term volatility may decrease

📘 Terminology Explanation

• Realized Loss: Loss calculated based on sell or transfer of tokens on the blockchain

• Death Cross: Technical bearish signal when short-term moving average crosses below long-term moving average

• Open Interest: The quantity of derivative contracts that are still open and not yet settled

TP AI Notes

This article summary uses a language model based on TokenPost.ai. The main content of the body may be omitted or may differ from actual facts.