After BTC’s recent correction, the market has split into two camps.
Some believe that “the correction is over,” while others think that “the correction isn’t finished yet.”
But for the current market, whether the correction has actually ended may not be the most important question.
What really matters is:
Even if the correction is not over, has the current BTC market structure reached a point where investors need to panic?
Based on the current data, the answer may not be as pessimistic as it seems.
If we compare the market environment in June this year to standing on the edge of a cliff, the current situation is more like standing on the second floor of a building.
At the edge of a cliff, the bottom is hidden by layers of fog, making every decline feel frightening.
But from the second floor, even another drop does not necessarily mean that the entire market structure has been destroyed.
More importantly, this correction itself has not completely exceeded previous expectations.
As early as September 28, the original author BITWU.ETH pointed out that BTC was currently in the “third stage” of the three-stage structure following the formation of the bear-market bottom — a phase characterized by divergence between capital inflows and price.
This type of “decay” structure does not necessarily show up immediately in price during its early stages. However, if the divergence between capital inflows and price persists, upward momentum tends to weaken over time.
So, what exactly does this BTC correction mean?
BTC Enters the Third Stage of the Three-Stage Structure as Capital Inflows Diverge from Price
As we have discussed previously, BTC does not necessarily move directly into a sustained uptrend after emerging from a bear-market bottom.
Changes in price, capital flows, and market participants can develop through multiple stages.
What is worth watching now is:
BTC price remains relatively strong, but the marginal momentum of capital inflows is gradually weakening.
This represents the third stage of the so-called three-stage structure.
The most important point about this structure is not:
“Price is about to fall.”
Rather:
Continued price appreciation does not mean that upward momentum can continue indefinitely.
During the early stages of the structure, even if capital inflows begin to weaken, BTC can still continue making new highs.
But as the divergence persists for longer, the market requires increasingly more new capital to sustain further price gains.
Once marginal capital can no longer keep pace with price, the market may go through a correction to reprice risk.
From this perspective, the current BTC correction is not entirely unexpected.
It can be viewed as the market responding to weakening capital momentum as the previous structure gradually moves into its later stage.
The Three-Stage Structure in 2023 Also Experienced a Similar Correction
If we look back at BTC’s market structure in 2023, we can find a somewhat similar three-stage pattern.
After that structure was completed, BTC experienced a relatively deep correction, with price moving toward the Short-Term Holder Realized Price, or STH-RP.
However, it is important to note:
The 2023 correction cannot simply be replicated in 2026.
The market environment at that time also included additional factors such as black-swan events.
In the current market structure, BTC only began correcting after experiencing two instances of divergence between capital inflows and price.
From this perspective, the current market has actually performed significantly stronger than the comparable stage in 2023.
This means:
Although there are similarities between the current BTC structure and 2023, that does not mean the current cycle will necessarily repeat the same path.
The market may also choose to:
Trade time for price.
In other words, BTC does not necessarily need to fall rapidly to a specific price level to release accumulated risk.
If the market moves sideways for a period of time while the cost basis of short-term holders gradually moves higher, the market may also absorb previous upward pressure through time.
STH-RP Is Around $74,000–$75,000 — Does BTC Really Need to Fall There?
This is one of the most important questions to watch in the current market.
In our previous article, we discussed STH-RUL, which is used to observe the unrealized loss pressure faced by short-term holders.
From the current market structure, another important level to watch is:
STH-RP, or Short-Term Holder Realized Price.
This cost basis is currently around $74,000–$75,000.
If BTC continues to correct, this area will naturally become an important price level to monitor.
But the question is:
Does BTC really have to fall directly to $74,000–$75,000?
The answer is uncertain.
The reason is that although BTC has already experienced a correction of around 8%, net capital inflows remain positive.
This means that while prices are adjusting, capital has not completely left the market.
If capital flows continue to demonstrate resilience, it may be more difficult than expected for BTC to immediately move down and test the STH-RP level.
Of course, this does not mean that $74,000–$75,000 cannot be reached.
There is always an element of uncertainty in the market.
But if a deeper correction does occur and BTC moves toward the STH-RP area, this level may actually deserve close attention.
From a market-structure perspective, it would not simply represent “another decline.” Instead, it could provide another opportunity to observe the cost basis of market participants and the market’s ability to absorb selling pressure.
After an 8% Correction, the Key Question Is Whether Capital Outflows Will Continue
In our previous article, we focused on capital-flow changes after BTC fell toward the $80,000 area.
At that time, the five most recent complete trading days — October 1, 2, 5, 6, and 7 — recorded combined net outflows of approximately $163.3 million.
Among them, October 7 alone saw approximately $484.9 million in net outflows.
This indicates that spot demand has indeed cooled to some extent.
But today’s analysis needs to take one step further:
Cooling capital flows do not necessarily mean that the market has entered another deep bear market.
What really matters is:
Will capital outflows continue to expand?
Or will capital flows gradually stabilize after BTC completes a correction?
If prices decline while capital continues to flow out on a large scale, the market’s ability to absorb selling pressure would need to be reassessed.
But if capital flows retain some resilience after BTC corrects, the market may simply be going through a normal process of risk release.
Therefore, instead of obsessing over:
“Is BTC at the bottom?”
It may be more useful to ask:
Are there still enough buyers willing to absorb the selling pressure after prices fall?
A BTC Correction Is Not the Problem — Synchronized Deterioration in Market Structure Is
For BTC, a price correction alone does not necessarily mean that risk has spiraled out of control.
The real concern is when multiple indicators deteriorate at the same time.
For example:
BTC price continues to decline → Capital outflows continue → Leverage remains elevated → Liquidations increase → Short-term holder loss pressure rises again → Market absorption weakens
If these conditions begin to appear simultaneously, market risk could indeed expand further.
Conversely, if:
BTC price stabilizes → Capital flows gradually stabilize → Leverage begins to decline → Liquidation pressure is released → STH-RUL does not return to an extreme zone
Then the current correction would be more likely to represent a risk-release phase during the transition from a bear market toward a bull market.
Therefore, the real question for the market is not:
“How much has BTC fallen?”
It is:
“Has this decline damaged the underlying market structure?”
KTX Crypto Market View: Focus on Market Absorption Rather Than Guessing the Bottom
For KTX Crypto, the most important issue in the current BTC market is still not predicting an absolute bottom.
No single indicator can accurately tell us:
How far BTC will ultimately fall.
Instead, multiple indicators can be combined to assess whether market risk is expanding.
Key indicators to monitor include:
BTC price structure → Net capital inflows → STH-RP → STH-RUL → MVRV → ETF flows → Open interest → Funding rates → Liquidation volume → Macro liquidity
Together, these indicators provide a more comprehensive framework for understanding market conditions.
If BTC continues to correct but capital flows do not deteriorate significantly, while short-term holder loss pressure remains outside extreme levels, the market may still be in a transitional phase between a bear and bull market.
If price gradually stabilizes, the current correction could even become an important process through which the market rebuilds its support and absorption capacity.
On the other hand, if BTC continues to decline while capital outflows accelerate, leveraged positions are increasingly liquidated, and STH-RUL rises rapidly, market risk would need to be reassessed.
Users can also visit the KTX Market page to monitor market data, the Fear & Greed Index, total futures open interest, liquidation data, and 7-day BTC ETF net inflows.
For BTC spot price, trading volume, and order-book data, users can visit the KTX BTC/USDT Spot Trading page.
To explore other KTX markets and trading products, visit the KTX official website.
It is important to note:
Market indicators help us understand “what is happening,” rather than telling us “what we should definitely buy right now.”
Especially during the transition from a bear market to a bull market, a correction does not necessarily mean that the broader trend has ended.
FAQ
Has the BTC correction ended?
It is currently impossible to determine whether the correction has ended based on price alone.
More importantly, investors should monitor capital flows, price absorption, short-term holder cost basis, and leverage structure after the correction.
If price stabilizes and capital flows gradually improve, the correction may be approaching its later stage.
However, if capital outflows continue while price keeps making new lows, the risk of a deeper correction would need to be considered.
Does an 8% BTC correction mean that the market has entered another bear market?
Not necessarily.
BTC is inherently a highly volatile asset, and an approximately 8% pullback from a recent high is not enough on its own to prove that the market has returned to a bear market.
Rather than focusing solely on the size of the decline, it is more important to observe:
Are capital outflows continuing? Is short-term holder loss pressure rising again? Are large-scale leveraged liquidations occurring? Is market absorption weakening significantly?
Only when multiple conditions deteriorate simultaneously would market risk become significantly more concerning.
Why can’t the current market simply be compared with 2023?
Although the current market shares some similarities with the three-stage structure seen in 2023, the macro environment, capital structure, and market participants are not exactly the same.
The 2023 correction was also influenced by black-swan events and other additional factors.
The current BTC market, meanwhile, began correcting after two instances of divergence between capital inflows and price, while overall price performance remains relatively stronger.
Therefore, 2023 can serve as a reference, but its path should not simply be replicated.
What does an STH-RP of $74,000–$75,000 mean?
STH-RP, or Short-Term Holder Realized Price, can be viewed as an important reference for the cost basis of short-term holders.
This cost area is currently around $74,000–$75,000.
If BTC experiences a deeper correction, this area could become an important level to monitor.
However, this does not mean that BTC must fall to this level.
The market could also move sideways and allow the cost basis of short-term holders to gradually rise, effectively using “time instead of price” to absorb accumulated risk.
If net capital inflows remain positive, why can BTC still fall?
Price is not determined by net capital inflows alone.
A slowdown in capital inflows does not mean that capital has completely left the market.
When the growth rate of new capital falls below the growth rate of price appreciation, a divergence between capital inflows and price can emerge.
Under these circumstances, BTC can still experience a correction even while net capital inflows remain positive.
Should investors be afraid if BTC actually falls toward the STH-RP level?
It would be inappropriate to simply assume that reaching STH-RP means “it is an opportunity,” just as it would be inappropriate to assume that BTC must rebound from that level.
If BTC approaches the $74,000–$75,000 area, the more important factors to monitor would be capital flows, short-term holder loss pressure, leveraged liquidations, and market absorption.
If multiple indicators remain stable, the market structure could still be very different from that of a deep bear market.
Conversely, if several indicators deteriorate simultaneously, greater caution would be warranted.
What is the biggest risk in the current market?
The biggest risk may not be an ordinary correction itself.
What deserves greater attention is:
Correction → Panic → Continued capital outflows → Leveraged liquidations → Further deterioration in market structure.
Therefore, rather than trying to predict one absolute bottom, it is more important for investors to monitor whether the underlying market structure is changing.
Conclusion
Has the BTC correction ended?
At this point, that may not actually be the most important question.
For the current market, the more important question is:
Even if the correction has not ended, has the market deteriorated enough to justify panic?
Based on the current structure, BTC is moving through the third stage of the three-stage structure that followed the bear-market bottom, with a certain degree of divergence already emerging between capital inflows and price.
This suggests that upward momentum is gradually weakening, making the current correction relatively unsurprising.
At the same time, the current market has not completely replicated the 2023 pattern.
BTC began correcting after two instances of divergence, while overall price performance remains relatively stronger. Even after an approximately 8% correction, net capital inflows remain positive.
Therefore, a direct decline toward the $74,000–$75,000 STH-RP area is not a predetermined outcome.
The market could also use time to allow short-term holder cost bases to gradually move higher.
So, instead of asking:
“Does BTC have to fall to a specific price?”
It may be more useful to ask:
Are capital outflows continuing?
Can price gradually stabilize?
Is leverage being released?
Is short-term holder loss pressure returning to extreme levels?
If these indicators do not deteriorate simultaneously, the current correction may simply represent another risk-release phase during the transition from a bear market toward a bull market.
And even if a deeper correction occurs in the future, that does not necessarily mean the market has returned to a deep bear market.
For BTC, the real risk has never simply been an ordinary correction.
It is:
Panicking during the correction, only to lose the ability to reassess the market when the trend actually begins to stabilize.
Original Source
📉 $BTC有人说“回调到此为止”，也有人说“回调没结束”；结束没结束不重要，重要的是，就算没结束，也不用害怕！
我们现在最多只是站在2层楼，而不是今年6月的悬崖边。悬崖上，层层迷雾看不见底，让人心生畏惧；而2层楼，即便摔下去也死不了。
这次回调原本就在我们的预期内，并没什么意外。
我在9月28日的推文中就有提到，目前BTC正处于走出熊底后三段式结构的“第3段”，即资本流入和价格产生背离阶段。
通常这种“衰减”形态的初期未必马上会反映到价格上，但只要背离持续存在，越到后面动能越弱。
比如2023年的3段结构走完，就迎来了一次直达短期筹码成本线（STH-RP）的深度回调。不过当时还叠加了黑天鹅事件的影响因素。
而从当前的数据图上来看，这次是在2次背离后才开始回调。在走势上要明显强于2023年的3段结构。
虽然有很多交易者会把现阶段和23年作为比对，但我个人观点是：这一次未必完全一样，它也可以用时间换得STH-RP慢慢上移。
至少从现有的情况看，回调了-8%但资本净流入仍然为正，要直接下去考验STH-RP也并非那么轻易（当前STH-RP在$74k-$75k左右）。
当然，凡事都有万一，如果真到了，千万别犹豫，这是市场再给你一次重装出发的机会，可遇不可求。
Original Author: Murphy
X Account: @Murphychen888
Original Post: https://x.com/Murphychen888/status/2108731745399152726
Risk Disclaimer
Cryptocurrency markets are highly volatile, and BTC prices may be affected by a wide range of factors, including macroeconomic conditions, monetary policy, market liquidity, capital flows, and investor sentiment. This article is provided for informational and educational purposes only and does not constitute financial, investment, or trading advice. On-chain indicators, capital-flow data, and market data may involve delays and model limitations, and historical patterns do not guarantee future performance. When using futures or other leveraged products, please make sure you fully understand the risks associated with margin, funding rates, and liquidation.