Key takeaways:
- Bitcoin’s weakening MVRV momentum signals a potential late-stage bull cycle.
- Spot and on-chain transfer volumes must increase for a potential breakout.
- Flipping $108,000-$110,000 resistance into support is crucial for bulls.
Bitcoin’s prolonged climb from April lows around $74,000 has entered a consolidation phase, trading near $112,000. Analysts weigh whether this pause signals the late stages of its bull market run or represents a necessary recalibration before aiming higher.
Calm before the Storm? MVRV Momentum Slows
Recent stability in the Middle East briefly spurred Bitcoin’s recovery, pushing it above the short-term moving average. However, the market value realized (MVRV) ratio indicates a cooling of recent gains. A CryptoQuant analysis suggests this might signal the late stages of the bullish cycle, especially as the ratio remains well below its overvalued threshold.
“Current MVRV deterioration… doesn’t mean a downtrend is imminent,” said analyst Yonsei_dent. A rebound in MVRV could indicate reduced selling pressure and pave the way for a new price discovery cycle, potentially driving Bitcoin towards $165,000 levels.
On-Chain Activity Shows Cooling
Evidence points to a slowdown in market activity. The seven-day moving average for on-chain transfer volume has retreated by approximately 32%, down to $52 billion from $76 billion. Similarly, spot trading volumes have dipped significantly compared to previous bull market peaks, raising questions about underlying conviction.
“Unlike the ATH rallies earlier,” notes Glassnode in its Week Onchain report, “the recent push did not trigger a correlated surge in spot volume,” highlighting reduced investor engagement. Increased trading activity is seen by analysts like Alva as a prerequisite for a significant breakout.
Navigating Key Technical Levels
BTC’s immediate battleground lies between $110,000 resistance and $100,000 support zones. Analysts concur that conquering $108,000-$110,000 is paramount.
“A break and four-hour close above $109K would be key,” stated AlphaBTC, forecasting potential all-time highs. Rekt Capital underscored the $108,000 level as “the final major weekly resistance,” while Michael van de Poppe indicated $109,000 was critical for sustaining upward momentum.
This analysis reflects current market readings and does not constitute investment advice. Always conduct independent research before making any investment or trading decisions.
