For the past few months, Kaspa market has been under pressure with prices predominantly trading below short- to mid-term moving averages (50DMA, 100DMA and 200DMA). Last week, price briefly dropped below two major support metrics: The 100-Week Moving Average (100WMA), a long-term trend indicator, and the Long-Term Holder (LTH) Realized Price, which represents the average acquisition cost for long-term investors. A sustained breakdown below these levels would have signaled a deeper phase of capitulation. Instead, Kaspa has staged a recovery this week, reclaiming these key thresholds.

Price Trend & Market Valuation

Price Recovery Above Key Supports

The ability to reclaim the 100WMA (0.10386 USD) and LTH Realized Price (0.10195 USD) implies strong demand in this range, potentially marking a local bottom. Historically, such recoveries after brief breakdowns often precede trend reversals or at least a period of stabilization.

Short-Term Moving Averages Still Bearish

Despite the recovery, price remains below 50DMA (0.11766 USD), 100DMA (0.13263 USD), and 200DMA (0.14156 USD), keeping the broader trend technically bearish. A definitive shift back to bullish territory would require price to break above and hold key resistance levels, starting with the 50DMA.

Additionally, MVRV Z-Score (1.40 percentile, +8.58% 30-day change) signals that Kaspa is significantly undervalued relative to historical price norms. This suggests that current levels could offer an attractive entry point for investors anticipating a market recovery, especially as confidence strengthens.

Long-Term Holders vs. Short-Term Holders

The 90-Day Coin Days Destroyed metric stands at 71.10 percentile (-6.40% 30-day change), reflecting a drop from 82.50 percentile last week. This decrease suggests a cooldown in selling activity from long-term holders, as older coins are being transacted less frequently. This could indicate that experienced holders are taking a more cautious approach, likely waiting for more favorable market conditions before making a move. With selling pressure from these holders reduced, this could help stabilize the market in the short term.

Although the drop in Coin Days Destroyed signals a cooling off of selling activity, the overall sentiment remains one of patience among long-term holders, with a reduced willingness to sell in the current market environment.

Market Liquidity & Capital Flows

Liquidity conditions have shown signs of gradual improvement over the past month, with the Realized Price 30-Day Change at -1.1% (12.90 percentile). While this figure remains negative, it represents a noticeable slowdown compared to the ~5% decline observed in the previous month. The Realized Price 30-Day Change serves as an important metric for assessing capital flows, as it reflects the shift in the average cost basis of the market. A decline in this figure typically signals ongoing capital outflows or a contraction in buying activity, while a stabilization or reversal toward positive growth indicates improving liquidity and investor confidence.

However, to signal a more robust recovery, an uptick in capital inflows—manifested through a rising Realized Price—will be crucial. Stronger buying momentum could help create a more sustainable foundation for upward price movement.

Additionally, Percent Supply in Profit (1.10 percentile, +13.20%) remains low, suggesting that only a small portion of holders are currently in profit. This typically leads to reduced selling pressure but can also limit immediate buying momentum.

In conclusion, while capital flows are gradually stabilizing, the market is still in a phase where external capital—through inflows and a shift in the Realized Price—will play a pivotal role in defining the next significant directional move. The current liquidity dynamics suggest that while downside risks may be diminishing, the path to a sustained uptrend requires further strengthening in both investor confidence and new capital entering the market.

Sentiment: A Slow Recovery Underway

Sentiment remains mixed but is showing early signs of improvement. The Net Unrealized Profit/Loss Ratio is at -8.77 (1.40 percentile, +52.92% 30-day change), which, while still negative, indicates that investors are becoming less deeply underwater. This aligns with the Mayer Multiple (0.77, 4.70 percentile, -25.01%), suggesting that Kaspa remains oversold relative to historical price trends.

For long-term investors, the improving metrics indicate that the market could be at or near a bottom, setting the stage for potential recovery. However, short-term traders may still face volatility as key resistance levels need to be reclaimed for a definitive bullish shift.

Conclusion: Signs of Strength, but Caution Remains

Kaspa has shown resilience by reclaiming key long-term support levels, but short-term indicators remain weak. The dominance of long-term holders and historically low valuation metrics suggest that downside risk is decreasing, but sustained capital inflows are needed to confirm a broader uptrend.

If price action continues to stabilize above 100WMA and LTH Realized Price, market sentiment could shift more positively in the coming weeks. For now, patience remains key as Kaspa navigates this period of recovery and potential accumulation.