Signal of the week: The sell-side risk ratio — which measures how much pressure the market is actually under to sell — dropped to its lowest level since October 2023. This suggests that holders have little urgency to exit right now, but large moves tend to be preceded by such a period of compression.
Bitcoin’s price dropped below $80,000 amid the jump in the U.S. CPI and PPI figures, as well as rising expectations of a Fed rate hike this year. The price now sits close to the point where the average recent buyer breaks even, which could become a turning point in either reestablishing the bearish move or testing major resistance levels.
About the Bitcoin Impact Index
The Bitcoin Impact Index measures which groups of Bitcoin holders are under financial stress, how severe that stress is, and whether it’s severe enough to shake confidence in the market’s direction. It combines on-chain holder behaviour, ETF and derivatives activity, and exchange-level liquidity flows into a single weekly score between 0 and 100. Unlike sentiment indicators, it deliberately excludes social media and volume data to focus on what participants are doing rather than what they are saying.
Score bands:
- Normal Rotation (0–24) — routine profit-taking, no structural shift
- Elevated Repositioning (25–49) — specific groups shifting positions, pressure uneven across the market
- High Impact (50–74) — broad stress across multiple holder groups and institutional flows simultaneously
- Critical Impact (75–100) — full capitulation: LTH losses, large ETF outflows, major liquidations, and heavy exchange inflows at once
Week 20 (May 11–17): BII 43.7 — Elevated Repositioning
Positive signals: long-term holders keep buying and LTH selling pressure stays historically low
Long-term holders added another 80,000 BTC to their wallets this week, continuing an accumulation trend that has persisted for months. This cohort is still buying despite their supply being increasingly in loss, which is a sign of conviction rather than panic.
The sell-side risk ratio — which measures how much pressure the market is actually under to sell — reached its lowest level since October 2023. The move is primarily driven by long-term holders whose own sell-side risk ratio is also near three-year lows, indicating that people who have held Bitcoin the longest have little urgency to sell right now.&
As such, the latter is a rather bullish signal from a long-term perspective. However, historically, similarly low sell-side risk ratio levels have often preceded sharp price moves in either direction over the short term. And since BCDD points to increased inactivity among long-term holders while short-term holders currently dominate Bitcoin selling, this dynamic could temporarily support bearish momentum before the broader long-term trend resumes.
Negative signals: ETFs faced one of their biggest outflows in 2026
Spot Bitcoin ETFs saw $1 billion in net outflows, the largest reading since January. A large part of the outflows was driven by this week’s U.S. inflation data, which significantly shifted market expectations around Federal Reserve policy. This suggests that institutions and retail ETF investors might have turned more cautious, which could potentially limit short-term inflows.
The 7-day SMA of stablecoin netflows was essentially flat at -$2 million after several weeks of high positive readings. This indicates that fresh capital hadn’t been arriving in any meaningful size last week, which means the record ETF outflow was not being offset by new retail buying power coming in.
Mixed signals: funding rates are getting closer to neutral
The share of liquidations coming from long positions jumped from 34% to 71%. This is the opposite of the short-squeeze dynamic that had been supporting price through April. However, risk aversion fueled by increased U.S. inflation figures also led to broader deleveraging, pushing funding rates closer to neutral levels instead of deeply negative. As for now, it removes a persistent source of one-directional derivatives pressure, but also highlights a period of indecision or a waiting mode.
What could happen next
Bitcoin is currently trading close to $77,000, moving below $78,000 where both its short-term holder cost basis and true mean price are located. If Bitcoin remains below $78,000, this could accelerate selling pressure. Moving and holding above it would mean the majority of short-term holders remain in profit, and this could help maintain bullish momentum
As for now, the next meaningful support is at $76,250, which corresponds to the 0.236 Fibonacci retracement from the all-time high. In turn, a break below $76,250 would likely cause an even deeper correction.
A recovery back toward $80,000 would require either ETF flows to reverse again or fresh stablecoin capital to arrive. However, a sustained break above it could open the path to $85,750 — the 0.382 Fibonacci level.Nevertheless, the sell-side is thin and the buy-side just got thinner, so Bitcoin may see increased volatility in the coming weeks.
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