Glassnode Analysts Predict Market Weakness After Bitcoin Hits $100K

Glassnode's co-founders, Jan Happel and Yann Allemann, are issuing a cautionary message regarding Bitcoin's (BTC) recent surge past the $100,000 mark, suggesting that a major market correction could be on the horizon.

The duo, known by their online persona Negentropic, highlighted a concerning trend in the Bitcoin Fundamental Index (BFI), which measures key indicators like transaction volume and wallet activity.

Not to Rain on the Parade, But… 💭

Bitcoin has crossed $100K, yet the Bitcoin Fundamental Index (BFI) is starting to weaken.

Should we be concerned? 🤔

This indicator often sends early warning signals, and once confirmed, they’re hard to ignore. Take the market peak in Q1… pic.twitter.com/MnuJtmrB9V

— 𝗡𝗲𝗴𝗲𝗻𝘁𝗿𝗼𝗽𝗶𝗰 (@Negentropic_) December 5, 2024

They noted that as the BFI weakens, the risk of a pullback increases. This metric has previously served as an early warning system, with similar declines signaling a potential market downturn, like the one seen earlier this year.

Despite Bitcoin’s impressive rally, the analysts suggest that the current market behavior is reminiscent of a plateau, where traders are hesitant to take profits.

This hesitation indicates a wait-and-see approach, with many holding out for even higher price levels. However, they also believe that if Bitcoin can secure a strong position above the $100,000 resistance, it could trigger a wave of buying, pushing the price even higher.

Bitcoin Traders Hold Out for Higher Levels 📊

Another sign of Bitcoin’s price consolidation is traders’ reluctance to take profits in this range.

They’re aiming for higher levels, expecting gains once Bitcoin starts challenging key resistances.

Once #Bitcoin overcomes its… pic.twitter.com/t710vMRRvk

— 𝗡𝗲𝗴𝗲𝗻𝘁𝗿𝗼𝗽𝗶𝗰 (@Negentropic_) December 4, 2024

In summary, while the bull market is far from over, the Glassnode founders are urging caution and keeping a close watch on the signals from the Bitcoin Fundamental Index. A correction could be approaching, but if Bitcoin continues to break resistance levels, the momentum may carry it further.