The current situation in the bitcoin market continues to put pressure on active participants. According to my analysis of on-chain data, active investors in the first cryptocurrency are on average at a loss of 20%. This conclusion is confirmed by the AVIV (Active Value to Investor Value) metric, which is now entrenched in the depreciation zone.
For a more accurate assessment of market sentiment, I use the True Market Mean (TMM) indicator. Unlike standard averages, this indicator excludes coins that have not moved for a long time from calculations. Many of these UTXOs are partially lost or belong to long-term "dormant" holders, whose cost basis is no longer relevant to the current market picture.
Resistance level at $76,700
Currently, TMM is estimated at approximately $76,700. This level has already proven itself as a resistance zone. In May, we observed how many investors preferred to exit positions "at breakeven," unwilling to lock in losses and continuing to hold the asset under pressure. Now, the AVIV metric is around the 0.8 mark. This is a direct indication that the market capitalization of the active supply is valued about 20% below its cost basis.
However, it is worth noting that the current drawdown is not critical by historical standards. In previous bear cycles, the AVIV ratio dropped to 0.5–0.6, which corresponded to losses of 40–50%. The current 20% is a noticeable but not extreme level.
Bitcoin's cyclicality has not been canceled
For a market reversal, it is not necessary to reach the bottom of previous cycles. The scale of bitcoin adoption in this cycle has grown significantly, which could smooth out the depth of the decline. Nevertheless, I urge caution. The inflow of institutional capital and the launch of ETFs have not changed the fundamental cyclicality of the asset. The rules of the game are dictated by the market itself, not by the volume of billions being poured in.
My recommendation: maintain humility in the face of market cycles. The current correction is not an anomaly but a natural phase that must be endured, relying on cold analysis rather than emotions.