Briefing
The core insight reveals a conflict between short-term pain and long-term structural strength. Short-Term Holders (STH) are actively capitulating, selling their coins at a loss as market volatility returns. This panic selling is being fully absorbed by a consistent inflow of new capital, a dynamic confirmed by the Capital Flow Momentum metric remaining positive.
This suggests the recent price correction is a necessary shakeout of weak hands; the structural market breakdown is avoided. The most important data point is that the Capital Flow Momentum indicator remains above zero , a condition that has historically defined the health of the underlying bull market structure.
Context
The market is currently wondering if the recent price drop and return of volatility signal the end of the bull cycle or the start of a deeper correction. The common question is whether the selling pressure from recent buyers is strong enough to break the long-term uptrend, or if the market is simply undergoing a temporary cleansing of speculative positions.
Analysis
The key indicator is Capital Flow Momentum , which measures the rate of change in the Realized Capitalization. Realized Cap represents the aggregate cost basis of the entire network, reflecting the total capital invested. When this momentum is positive (above zero), it means more new capital is entering the network than old capital is exiting at a loss, suggesting a healthy, growing structural demand. The recent data shows a significant spike in Short-Term Holder Coindays in Loss , a measure of the total age of coins sold by recent buyers at a loss.
This loss-taking is a sign of emotional exhaustion. The fact that the Capital Flow Momentum has remained positive through this STH selling confirms that long-term investors or institutions are stepping in to absorb the supply without the network’s aggregate cost basis deteriorating.
Parameters
- Key Metric – Capital Flow Momentum → The rate of change in the network’s total realized value (aggregate cost basis).
- Short-Term Holder Capitulation → A significant spike in Coindays in Loss, indicating recent buyers are selling at a loss.
- Structural Support Level → The $100,000 price level, which defines a key psychological and on-chain support zone.
Outlook
This data suggests the market is undergoing a necessary cleansing phase that is strengthening the long-term foundation. The near-term outlook is one of consolidation as new capital absorbs the capitulating supply. The trend suggests that the structural bull market is resilient, and the price floor is strengthening. A confirming signal to watch is the Capital Flow Momentum turning sharply higher, indicating the new capital absorption phase is accelerating.
