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Bitcoin’s recent push to $120,000 has now become a stagnation that resembles an “failed breakout zone,” Swissblock, a market research firm, has said. The firm stated in a thread on July 31, “momentum has failed to ignite,” The argument is that the realized profit flows, and a large share of coins in profits have made every rebound an opportunity to bring supply up to price.
Bitcoin Rally Cooled by Profit-Taking
Swissblock described the setbacks as more of a pause than a breakdown. “Profit-taking is rising—but not as intense as late 2024,” The firm added that the effects through July were “enough to cap upside and trigger consolidation.” This is a voice of reassurance, not capitulation. “Selling pressure is visible, but not extreme—think cooling, not capitulation.” That diagnosis hinges on on-chain readings of realized profit—an input that tends to expand into rallies as long-held coins are spent into strength—and a market structure in which bids are absorbing supply rather than being overwhelmed by it.
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Most striking statistic in this article thread Profitability is measured by the breadth. “96% of supply is in profit,” Swissblock cited Glassnode. The ratio historically correlates with the late-cycle optimism, but is also mechanically limitative; it increases when almost all holders of shares are in green.unrealized gains There are many sellers who will try to lure you. Swissblock said, “Strong holders remain. But unrealized gains are tempting sellers. Until demand returns, each bounce invites supply.” The company contends that the trend is broader “is intact—but momentum needs a reset.”
Beyond the realized flows on chain, the company’s composite fundamentals show a neutral picture with improved liquidity. “BTC fundamentals are strong and stable,” Swissblock reported that the Bitcoin Fundamentals Index had a reading of 60, which is neutral. “Network Growth is cooling,” The following are some examples of how to get started: “Liquidity is recovering.” That mix typically favors range behavior over directional surges—”a consolidation-supportive environment,” as the post put it—in which Bitcoin “can grind sideways longer—until it’s ready to break with conviction.” It is implied that market prices are rising. “failed breakout” The risk is not a reversal of trend, but rather a reflection on timing. Positioning and liquidity are still insufficient for an extended continuation.
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It is important to consider the cross-asset perspective. “Altseason is active—but under stress,” Swissblock wrote observing that “$ETH continues to outperform BTC structurally, holding up better in this pullback,” most altcoins are saggingWith a “only 5% of top 100 showing positive impulse.” This thinning of rotation highlights the selectiveness of risk appetite, and fragility of momentum beyond the biggest names. This pattern has historically been seen to precede a Bitcoin move that is either decisive or recharges rotation.
Swissblock’s conclusion is cautiously optimistic. “Profit-taking is fading and selling pressure is being absorbed. BTC is preparing for breakout—but momentum needs to align.” Until this aligns, Swissblock expects the market to grind along: Bids will continue to match supply from successful holders, profits realized will moderate, while liquidity in the back ground improves. Swissblock believes that if and when Bitcoin’s momentum turns positive again, spillover effects could be significant: “While BTC grinds sideways, watch for the moment it flips—ETH and altcoins will likely explode upward when it does.”
The market dip today to $115,000 is less of a rejection and more a test to see if it can digest its profits, reset the momentum and not damage the underlying uptrend. The next step will likely depend on how quickly liquidity and the demand for profit can be reestablished before profits are taken again. Swissblock has a clear message: The breakout must be earned.
BTC is currently trading for $115.452.
Featured image was created with DALL.E chart by TradingView.com
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Source: www.newsbtc.com
