Negative 7dMA Shows Capital Outflows — Bitcoin Enters High-Risk Distribution Phase
On-chain metrics show Bitcoin is in a high-risk regime as capital exits the market. CryptoQuant analysis of seven-day moving average (7dMA) net capital flow — realized profits minus realized losses — sits near -$160 million, indicating average daily net capital loss over the past week. Elevated coin movement (% Supply Active, last 180 days) is 31.79% (above its 30-day average and in the 80th historical percentile), up 14.4% year-over-year. The combination of negative 7dMA and rising supply activity suggests active distribution and loss-taking, not accumulation. Price action: BTC is trading around $88,700, capped below $90k with lost momentum after a correction from $120k–$125k earlier in the year. Technicals show BTC below a faster-moving average (now resistance) but above a longer-term rising MA that still provides structural support. Volume spiked on the sell-off from >$110k; the rebound to ~$88k has low participation. Key ranges: holding $86k–$90k preserves the bullish structure; failure to reclaim $95k–$100k keeps downside risk elevated. For traders: expect heightened volatility and potential further downside while 7dMA remains negative and supply activity stays high; reduced conviction implies rallies are likely to be sold and volume-driven sell events can accelerate losses.
Bearish
The article documents a negative seven-day moving average of net capital flow (~ -$160M), combined with elevated % Supply Active and subdued rebound volume. Historically, negative short-term net capital flow paired with rising coin movement signals distribution and capitulation rather than accumulation — a bearish configuration that increases the probability of further downside. Technicals support this: BTC lost a faster-moving average (now resistance) and reclaimed lower price structure, with key support between $86k–$90k. If that zone fails, momentum could accelerate toward lower support levels. Short-term impact: higher volatility, increased probability of further declines, and rallies likely to be sold into. Traders should reduce leverage, tighten stops, or favor short/hedged positions until 7dMA recovers toward zero/positive and volume confirms sustainable bids. Long-term impact: the broader uptrend remains intact while longer-term moving averages hold, so sustained long-term bearish reversal is not confirmed unless capital flow and longer-term technical structure break down — similar to past distribution episodes where capitulation preceded renewed accumulation only after a period of washout and positive net flows returned.