BTC Market Update

BTC has gained by 4.0% over the past week.

Do these 4 different cyclical signals indicate Bitcoin’s market top?

Over the past day, Bitcoin (BTC) saw a strong uptick, reaching $88.7k, breaking out of a consolidation phase. However, it has since retraced to $86k, reflecting heightened volatility.

Given these market conditions, stakeholders are speculating about a potential market top. CryptoQuant analyst Burak Kesmeci pointed out four on-chain metrics that may signal the end of Bitcoin’s bull market.

Four Cyclical Signals Indicating Market Top

CryptoQuant highlights four indicators suggesting a potential market top:

1. Inter-Exchange Flow Pulse (IFP): Currently at 696k, below the SMA90 of 794k. A bearish trend is likely as long as IFP stays below SMA90. In previous cycles, BTC surged after IFP crossed above this moving average.

2. CQ Bull & Bear Market Cycle Indicator: Signals bearishness, with DMA365 at 0.18 and DMA30 at -0.16. A bullish trend shift will require DMA30 to cross above DMA365.

3. MVRV Score: Remains below SMA365, indicating potential continued correction. Historically, a drop below this support level increases selling pressure.

4. Net Unrealized Profit and Loss (NUPL): Currently at 0.49, below SMA365. Without an upward movement, corrections are likely to continue.

These four metrics suggest Bitcoin is facing significant short- to mid-term turbulence, but none indicate an overheated market. The current scenario parallels the carry trade crisis of August 5, 2024, where macroeconomic conditions drove prices down. External factors, like Trump’s tariff policies, have also affected the market.

If historical patterns hold, improving macroeconomic conditions could lead to a Bitcoin recovery.

BTC Chart Analysis

While CryptoQuant’s analysis shows a worrying trend, AMBCrypto indicates that a market top has not yet formed, and key players remain bullish.

Bitcoin whales remain optimistic, as evidenced by a declining Whale exchange ratio. This trend implies that large holders are retaining BTC rather than selling.

Additionally, Bitcoin’s exchange netflow has been negative for five consecutive days, indicating that buyers have taken control. This increasing outflow has pushed Bitcoin’s exchange reserves to a yearly low, suggesting fewer transfers into exchanges.

With low exchange inflows, prices are expected to recover under improved market conditions. In conclusion, while there are indicators of a potential end to the bull market, there is still room for growth. If this bullish sentiment continues, BTC could reclaim the $90k level, although a correction may push it down to $85,222.