Glassnode Analysis: Bitcoin Market Structure Turns Fragile
Glassnode’s latest on-chain data shows a clear shift in Bitcoin market structure from euphoria to fragility. After Bitcoin’s price surged to $117,000 and then plunged to $111,000 in just one week, spot market momentum weakened significantly. The relative strength index (RSI) entered oversold territory, seller pressure intensified, and trading volumes remained stable but unimproved, underlining fragile buyer confidence.
In the futures market, open interest has contracted, indicating reduced leverage, while funding rates spiked due to ongoing long-side additions. Net positions saw only slight relief, and speculative appetite cooled. The options market revealed heightened hedging activity: open interest edged up, but volatility spreads narrowed sharply as traders brace for potential declines.
Spot Bitcoin ETFs saw a reversal in inflows, with a net outflow of $1 billion over the week. Trading volumes slowed and the ETFs’ market value to realized value (MVRV) ratio weakened. After weeks of strong capital inflows, traditional financial demand is cooling and profit-taking pressure is rising.
Overall, Bitcoin market structure is fragile. Weak momentum in spot, futures, and ETF inflows, plus growing hedging demand on options, suggest a tentative outlook. On-chain metrics confirm cooling demand, reduced capital inflows, and declining profitability. The coming weeks will test whether off-exchange capital returns to stabilize prices or whether selling pressure triggers deeper consolidation.
Bearish
The analysis points to weakening spot momentum, declining futures open interest, and significant ETF outflows, all signaling reduced buying confidence. Heightened option hedging and narrowed volatility spreads suggest traders brace for declines. Historically, similar RSI oversold conditions after sharp rallies have led to short-term consolidation or pullbacks. In the near term, bearish pressure may persist until institutional demand returns. Over the long term, renewed off-exchange capital could stabilize prices, but current indicators favor a bearish bias.