Bitcoin Local Stress Index (LSI)

Over the past week, the Bitcoin market has gone through two distinct periods of elevated stress. The first wave occurred between October 28–30, when the LSI reached extreme levels of 74–75% amid a price decline from $113K to $106K, accompanied by high realized volatility and aggressive selling (ASR >0.52). A brief relief phase followed on October 31–November 1, as the index dropped to 30–40% and the price recovered to $110K, however, this proved to be only a short pause before a renewed wave of sell pressure.

The second wave of stress began on November 2 and continues to this day. The LSI has again risen to critical levels of 67–73%, coinciding with strengthening bearish signals: the price is trading below the 6-hour SMA, realized volatility remains elevated (RV z-score >5), and the aggressive selling ratio stays above 0.51. As of 08:00 UTC on November 4, the LSI stands at 58.6% (ELEVATED condition), with the price dropping to around $104K. The market shows structural weakness characterized by rising leverage and negative liquidity flow, indicating sustained sell-side pressure.