Bitcoin Rally Runs on Thin Ice, Glassnode Warns
The rally of Bitcoin's price has been driven by thin liquidity rather than strong buying conviction, according to Glassnode's Weekly Pulse report. The report shows that spot trading volume fell more than 20% over the past week, and aggressive sellers began outnumbering aggressive buyers despite higher prices.
Bitcoin's price struggled to hold onto $63,000 on Monday morning, with retail sentiment on Stocktwits turning 'bearish' from 'bullish' territory in a week. Over $250 million in leveraged crypto positions were liquidated over the past day, with long positions accounting for most of the losses.
Bitcoin's 14-day Relative Strength Index (RSI) jumped from 50.8 to 66.9, a 31.8% weekly rise that has pushed the asset into overbought territory. However, spot trading volume contracted by 21.5%, falling from $5.2 billion to $4.1 billion.
According to Glassnode, 'the advance has been driven by relatively thin liquidity rather than broad-based buying conviction.'