CryptoQuant contributor predicts further downside in BTC futures market, citing lack of capitulation

In a recent post, CryptoQuant contributor MAC_D suggested a potential for further downside in the Bitcoin futures market. MAC_D noted that as Bitcoin dropped below the $59,000 support level on May 1, about $120 million in BTC/USDT perpetual futures longs were liquidated. This amount is smaller than previous liquidations at this price point, suggesting a lack of strong selling activity or capitulation in the futures market. Although the funding ratio indicator has shown occasional negative values, these are not significant enough to imply major shorting activities. For a market bottom to form, typically a substantial amount of liquidations and a rush to short positions are required; however, the current data suggests that a capitulation has not yet occurred, suggesting potential for further downside. Despite this, the market outlook isn't entirely negative, as on-chain metrics like the market-value-to-realized-value (MVRV) ratio hint at a potential upside. Essentially, a capitulation signal in the futures market could present an opportune moment to purchase Bitcoin at a lower price.