Tag: market bottom

  • Bitcoin Long-Term Holders Begin Profit-Taking as On-Chain Metrics Hint at Market Bottom

    Bitcoin Long-Term Holders Begin Profit-Taking as On-Chain Metrics Hint at Market Bottom

    Bitcoin’s long-term holders (LTHs) have started to sell after months of continued accumulation, signaling a potential new phase in the market. Despite profit-taking by seasoned investors—which is likely to create short-term selling pressure—several on-chain metrics suggest Bitcoin could be entering conditions more commonly seen near market bottoms.

    On-chain data reveals that LTH supply recently began declining after climbing close to 16 million BTC, while the supply of LTHs in short-term holding periods remains comparatively low. Historically, after extended price rallies, long-term investors have sold part of their holdings, allowing new investors to enter the market.

    On-Chain Indicators Suggest Accumulation

    The LTH/STH Spent Output Profit Ratio (SOPR) has moved closer to 1, indicating that the profits of long-term and short-term holders are converging. Historically, this pattern occurred in 2015, 2019, and 2022, with selling pressure easing slowly over time and accumulation resuming. While the ratio has not yet entered its traditional accumulation zone, current readings suggest the market is heading further toward that zone.

    This cycle also differs from previous ones. Bitcoin’s first major price increase in the current cycle took approximately 31 months to achieve—much longer than the 8 to 17 months seen in past cycles. This extended timeline suggests that investor behavior has evolved alongside the rising institutionalization of the market.

    Also Read: Bitcoin Security Faces New Questions After the Coldcard Wallet Hack

    Fear Persists Despite Improving Fundamentals

    LTH supply recently started declining after climbing close to 16 million BTC. Currently, the Crypto Fear & Greed Index stands at 40, indicating neutral market sentiment. Bitcoin’s Market Value to Realized Value (MVRV) ratio has been squeezed to the 1.21–1.22 zone. Historically, when sentiment turned negative while on-chain fundamentals improved, new accumulation phases have begun. Meanwhile, long-term investor supply remains near record levels, suggesting that established investors are holding onto most of their Bitcoin after recent distributions.

    Although no single indicator can accurately identify a market bottom, the combination of record long-term holder conviction, compressed valuations, subdued speculative activity, and cautious investor sentiment increasingly resembles conditions seen before previous Bitcoin recoveries.

    In the short term, Bitcoin appears to be transitioning from a distribution phase to what could become an accumulation phase. Whether this marks the cycle bottom will depend on overall macroeconomic conditions, investor demand, and the market’s ability to absorb continued selling pressure from long-term investors.

  • Bitcoin Bottom? 3 Bullish Signals Emerge After Record Monthly Drop

    Bitcoin Bottom? 3 Bullish Signals Emerge After Record Monthly Drop

    Bitcoin’s sharp June decline has raised a key question for traders: Was the fall below $60,000 a cycle-bottom signal or the start of deeper market stress? According to a July 7, 2026, report from 21Shares, Bitcoin saw its worst monthly decline in years, dropping 19% in June and forming a base close to $60,000 at the end of the month.

    Whale Buying Signals Accumulation

    A notable bullish indicator came from large holders. The number of investors in profit dropped below 50%, even as the whale accumulation increased when BTC was trading between $60,000 and $64,000, as per the report.

    “The last time these signals converged (during the March 2020 Covid crash and the Q4 2022 FTX collapse), the market was at or near a cycle bottom, both considerable entry points,” the report said.

    It isn’t necessarily a sign of Bitcoin reaching bottom, but an indicator that some long-term investors were buying when the weaker hands were selling out. That makes June’s decline look more like forced repositioning than a collapse in conviction.

    ETF Outflows and Basis Trade Unwind

    The overall risk-on/off sentiment affected markets, including Nasdaq, which lost $1.13 trillion in value in June, and the S&P 500, which lost $560 billion. The digital assets also lost approximately $380 billion in market cap.

    Bitcoin also faced added pressure as US Bitcoin spot ETFs saw over $2.5 billion in outflows in June. Much of this, however, was attributed to the basis trade, where traders would purchase spot ETFs while selling short Bitcoin futures, the report indicated.

    According to CME data, the leveraged position decreased from around 100,000 BTC to approximately 63,000 BTC, representing approximately $2.3 billion in unwound positions. This indicates the selling was partly mechanical rather than purely bearish.

    Key Levels and Macro Triggers

    The analysis warned against relying on price alone, stating, “Three things will tell you more than any single price move.”

    • The first is the inflation report from late July. If prices, particularly energy, are lower, it could support expectations of Federal Reserve easing later in 2026.
    • The second is whether Bitcoin will remain in the $59,000-$62,000 range, where its 200-week moving average aligns with past buying levels. Any week that closes below this range will raise downside risk.
    • The third is the midterm elections in November. The analysis found that Bitcoin has been negatively correlated with the likelihood of a Democratic sweep on Polymarket since mid-2025, with the correlation being -0.79.

    Why This Matters

    This technical correction reveals that June’s sharp drop was driven by structural arbitrage unwinding and broader macroeconomic risk-off trends rather than a loss of developer or investor conviction. Long-term whale accumulation during this decline signals that institutional players are aggressively treating forced liquidations as a strategic cycle-bottom entry window.

    Bull and Bear Case

    If the bull case prevails, easing of inflation and geopolitical de-escalation may be enough for Bitcoin to advance to the $66,000 mark and move towards $70,000-$75,000.

    If inflation remains sticky and renewed geopolitical stress persists, then the bear case is once again looking toward $50,000-$55,000 for Bitcoin.

    The long-term thesis for the asset does not align with the downtrend, and fundamentals have improved during the drawdown, the report said.

    FAQs

    1. Has Bitcoin bottomed after its June decline? Bitcoin may be near a bottom, but confirmation is still missing. Whale accumulation and support near $59,000-$62,000 are positive signs, but macro risks remain important.
    2. Why is whale buying important for Bitcoin? Whale buying shows that large holders were accumulating while weaker investors were selling. Historically, similar signals appeared near major market bottoms in March 2020 and Q4 2022.
    3. What caused Bitcoin’s June sell-off? The decline was driven by macro pressure, ETF outflows, and basis trade unwinding. US spot Bitcoin ETFs saw over $2.5 billion in outflows during June.
    4. What Bitcoin level should traders watch now? The key support zone is $59,000-$62,000, where the 200-week moving average aligns with historical buying levels. A weekly close below this range could increase downside risk.
    5. What is the bull case for Bitcoin? The bull case depends on cooler inflation, geopolitical de-escalation, and stronger demand. If Bitcoin reclaims $66,000, it could move toward the $70,000-$75,000 range.
  • Bitcoin Tests Key Support as Early Bottom Signals Emerge: What Traders Should Watch

    Bitcoin Tests Key Support as Early Bottom Signals Emerge: What Traders Should Watch

    Bitcoin has reached a critical price zone as on-chain data reveals early signs of a market bottom, while long-term chart levels continue to expose the cryptocurrency to further losses. Selling pressure appears to be easing after heavy market declines, but analysts caution that Bitcoin must hold nearby support before any sustained recovery can develop.

    The next several weeks will be pivotal in determining whether buyers can establish a stable base or if sellers will drive prices toward lower levels.

    On-Chain Model Enters Bottoming Zone

    On-chain analyst MorenoDV notes that Bitcoin has produced one of its first signals of a deeper market cleanup, though the data does not confirm a final bottom. The analyst uses the Bitcoin UTXO Block Profit and Loss Count Ratio Model, which compares profitable UTXO blocks with those holding unrealized losses.

    A high ratio indicates many holders still have profits available, creating room for further selling as investors reduce exposure or lock in gains. Conversely, a lower reading suggests more holders have moved into losses after the market has already absorbed heavy selling pressure.

    The latest ratio has entered a zone associated with earlier bottoming periods, but MorenoDV says the 365-day moving average still needs to decline further. Until that longer-term measure drops, the current signal may reflect a temporary oversold phase rather than a complete market reset.

    Bitcoin Range Keeps $67,000 in View

    Crypto trader Honey observes that Bitcoin has already moved below the June low near $59,000, leaving the June high around $67,000 as the next major range level. The trader expects the strongest range-bound outcome to involve a rise over the next four to six weeks before Bitcoin approaches the June high.

    That path would carry the price from one side of the current range to the other before any larger decline develops during the fourth quarter. This outlook does not signal the start of a new bull market, as Bitcoin would remain inside an established range while traders await clearer direction.

    Short-covering could also trigger brief rallies if bearish traders close positions, although MorenoDV says those moves would not prove a lasting recovery. The key question is whether buyers can sustain enough demand to push Bitcoin toward $67,000 while the broader market still tests long-term support.

    200-Week Average Shifts Focus Lower

    Chart analyst Nic Puckrin notes that Bitcoin closed below its 200-week simple moving average for the first time in more than three years. The break also marked the first move below that average during the current market cycle, increasing attention on lower support levels.

    In earlier bear markets, the 200-week average served as a major reference point for traders tracking long-term market weakness. Puckrin identifies the 61.8% Fibonacci retracement near $57,900 as the next support level if Bitcoin remains below the long-term average.

    If sellers break that zone, traders may turn toward the on-chain realized price near $53,200 as the next major level. For now, on-chain conditions suggest slower selling, while chart signals show that Bitcoin still faces pressure around several important support areas.

    What’s Next?

    Bitcoin shows early bottoming signals as selling pressure begins to ease, but the market still faces major risks below the 200-week moving average. Support at $57,900 and $53,200 remains critical, while $67,000 marks the next recovery target. Traders should watch these levels before confirming a stronger rebound.