Bitcoin fell below the psychologically important threshold of $70,000 at the beginning of the week, and market sentiment has significantly deteriorated. The number of investors selling at a loss is growing, more coins are heading to exchanges ready to be sold, and the fear index has returned to the zone of extreme panic.
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Selling pressure intensifies as short-term investors lose their nerve
According to analysts, bitcoin has entered a new distribution phase, a period when part of the market is gradually closing positions and supply is beginning to exceed demand. The drop below $70,000 was accompanied by increased seller activity and weaker sentiment across the cryptocurrency market.
Data on short-term holders is particularly important. The STH-SOPR indicator fell below 1, which means that investors who bought bitcoin in recent months have started selling at a loss. At the same time, more coins are heading to exchanges from investors who have held bitcoin for six to twelve months, which could increase pressure for further decline.
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Fear in the market is growing, but major players remain active
The negative mood is also confirmed by the Crypto Fear & Greed Index, which has fallen into the zone of extreme fear. The total cryptocurrency market capitalization has declined by approximately 7 percent over the past week, and spot bitcoin ETFs continue to face capital outflows that have persisted for several consecutive trading days.
However, the current market picture is not clear-cut. While some investors are panicking and reducing risk, on-chain data shows an increase in large transactions over $100,000. This may indicate that some larger players are using the decline to accumulate. The decline may therefore not be over, but extremely negative sentiment often creates an environment in which long-term investors begin looking for new opportunities.
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