The analyst sees the market swing as the main Binance Bitcoin index falling to 0.35

Binance’s Bitcoin Derivatives Index fell to 0.35, with analysts noting that similar readings are near market lows.

Bitcoin (BTC), which was trading around $300 around $69,000 at the time of writing, has recorded readings from a number of on-chain indicators that often precede major trend changes, including weakening derivatives momentum and declining short-term holder equity.

The signals come at a time when the flagship cryptocurrency is struggling to hold on to recent gains, leaving traders divided on whether the current setup points to a rebound or deeper weakness.

Commodity index derivatives and their short-term equity holders attract attention

In an update on March 9, chain analyst Amr Taha wrote that the Binance Bitcoin Derivatives Market Index fell to around 0.35. According to the analyst, the reading is close to the levels seen in July and August 2024 and is below the 0.43 in April 2025. In the past, readings near these levels have occurred during major market declines, followed by significant price increases.

In the same post, the analyst shared a chart that tracks the market value of BTC held by short-term holders, and according to the chart, the figure has fallen to around $390 billion, down from around $437 billion recorded on April 7, 2025.

According to Taha, large declines in this index have often been the precursor to major surrender events among short-term holders. For example, the same situation occurred on April 8, 2025 (one day after the previous record value of $437 billion), when intense selling pressure pushed BTC to $78,000, before later rising above $108,000.

Elsewhere, analyst GugaOnChain described the current situation as a “No Traction Engine” diagnosis, pointing to a network value to transaction value (NVT) ratio that rose 77% to 41.34.

NVT compares the market value of BTC with the volume of transactions on its chain, and the increase recorded shows that the price moves without corresponding activity of the network.

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According to the expert, STH-MVRV sitting at 0.76 is a confirmation that retail investors are realizing losses, while Coinbase Premium is turning negative at -0.0048, indicating that there is institutional selling pressure.

“The ‘No Traction Engine’ diagnosis is a severe warning,” they wrote. “Don’t be fooled by momentary stability or volumeless returns.”

Mixed circuit signals

The convergence of the indicator described above occurs when Bitcoin is trading in a narrow range and the ongoing conflict in the Middle East causes its volatility. Assets briefly touched $74,000 last week, but on March 8, it fell below $66,000, according to CoinGecko, before returning to its current level of $68,000.

Meanwhile, U.S. Bitcoin ETFs saw nearly $568 million in new money last week, the second straight week of positive inflows after months of steady buying.

However, according to SoSoValue, daily data showed little volatility, with strong inflows earlier in the week moving nearly $350 million last Friday. The pattern suggests that some investors are still cautious even as new money enters the market.