Bitcoin’s recent bounce to $84,000 has sparked optimism, but on-chain metrics suggest traders should approach this recovery with caution. The leading cryptocurrency has gained nearly 10% since testing $74,000 support levels, though analysts warn this could be a false signal rather than a definitive trend reversal.
As Bitcoin continues testing critical support levels, on-chain data reveals conflicting signals about the sustainability of the current bounce.
Key On-Chain Metrics Paint Mixed Picture
CryptoQuant’s analysis highlights two critical metrics suggesting caution:
- Apparent Demand (30-day sum) shows early signs of recovery from negative territory
- Short-term holder (STH) realized price averages $92,800, indicating widespread losses
These metrics echo patterns seen during the 2021 cycle, where temporary price recoveries failed to establish sustained uptrends. Despite recent volatility, long-term holders remain largely profitable, providing some market stability.
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Binance Exchange Flows Signal Reduced Selling Pressure
Data from Binance shows encouraging signs of decreasing sell pressure:
- STH inflows dropped from 17,000 BTC to 9,000 BTC
- Exchange outflows beginning to outpace inflows
- Reduced immediate selling pressure from short-term holders
Market Outlook and Key Levels to Watch
While the immediate selling pressure appears to be easing, several factors suggest maintaining a cautious stance:
- Historical parallels to 2021 suggest potential for extended consolidation
- Macro-level trend reversal requires additional confirmation
- Key resistance levels remain at $88,000 and $92,000
FAQ Section
Is Bitcoin’s current bounce sustainable?
While selling pressure has decreased, on-chain metrics suggest more confirmation is needed before calling this a definitive trend reversal.
What price levels should traders watch?
Key resistance levels are at $88,000 and $92,000, while support remains at $74,000.
How does this compare to previous market cycles?
The current pattern shows similarities to the 2021 cycle, where temporary recoveries preceded longer consolidation periods.