Key metrics for bitcoin tip bearish as global economy wobbles

The global economy wobbled last week on revelations China’s domestic market appeared to be weakening, perpetuating a risk-off mood from equities and crypto

article-image

Millenius/Shutterstock, modified by Blockworks

share

Flagship crypto bitcoin is beginning to unwind its momentum from earlier this year, following its largest single-day loss in 2023 late last week.

The asset has hit a 5-month low in its aSOPR (7-day moving average), falling to 0.99251, data from blockchain analytics provider Glassnode shows. Bitcoin has also closed below its 200-day moving average for the first time since February.

The aSOPR (Adjusted Spent Output Profit Ratio) measures the profit and loss of coins moved on-chain. A decrease in the figure could indicate investors are selling at a loss.

Closing below the 200-day moving average, typically viewed as a bearish sign in financial markets, adds further insight into the industry marked by fresh volatility and regulatory challenges. 

Those metrics square against a global economy grappling with uncertainty, emphasizing the shifting focus this year away from digital assets and a potential pivot in investor sentiment. 

Selling pressure has swept across global markets, causing Wall Street’s primary indexes to end lower on Friday, while Asian shares ended down for a third straight week of losses. 

The driving factors behind these movements center on apprehensions about the state of China’s economy and the expectation that US interest rates will be maintained at higher levels for a more prolonged period.

While bitcoin’s (BTC) correction cannot be traced back to a single piece of fundamental news, several factors likely contributed, fintech firm NYDIG wrote in a recent research note.

Those include the bankruptcy of Evergrande late last week, a simultaneous Wall Street Journal article observing that SpaceX had disposed of all its bitcoin holdings in 2022 and the ongoing weakness in risk-associated markets such as equities since the beginning of the month.

“One ‘tell’ about the move on Thursday was the price action in alts on Wednesday,” NYDIG wrote. “Unexplained significant weakness was seen in many altcoins that perhaps portended the move in the major coins, such as bitcoin.”


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Top Icon.png

Research

Osmosis thrived in H2 2023 on the back of increased DeFi activity deriving from recently launched Cosmos-related projects and better market conditions. With new value accrual mechanisms for the native token, Osmosis is well-positioned to continue its strong performance in 2024.

/

article-image

Though the opposing flow trend is likely to slow over time, industry watchers note, bitcoin fund assets could one day eclipse the $90 billion gold ETF space

article-image

Celestia had the first mover advantage. EigenDA has staked ether. What sets Avail apart?

article-image

Bitcoin moved 1% higher Monday morning in New York, Matrixport analysts say $62,000 could happen next month

article-image

It’s hard to believe right now that crypto — even with all of its flexibility and massive capabilities — could ever be like cash on the internet

article-image

Michael Saylor announced Monday morning that MicroStrategy bought 3k more bitcoin after the X account was compromised over the weekend

article-image

Plus, Pudgy Penguins grows its brand and a group of Autoglyphs sell for $14.5 million