The key take-aways
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Bitcoin has formed an engulfing bearish candle, which indicates a potential short-term fatigue.
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Profit-taking reached record levels, as did the Miners’ Position Index.
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Despite panic selling, over 196,600 BTC was accumulated in the $116,000–$118,000 range, reinforcing traders’ bullish long-term sentiment.
BitcoinBTC() has printed its first significant bearish signal since the beginning of May. A bearish engulfing pattern was confirmed by a firing star. The rally of 19% over the last 21 days may be a sign that traders are exhausted.
CryptoQuant’s data showed that the Miners’ Position Index soared to its highest point since November 2024, a level of 2.78. The MPI is a measure of how much Bitcoin miners send to exchanges in comparison to the average for the past year. High readings indicate a higher likelihood of trading. Although this spike may increase short-term stress, it is still well below the levels seen at bull market tops.
Adding to this cautionary outlook, realized profit and loss (P&L) from BTC deposits to centralized exchanges hit an all-time high of $9.29 billion, signaling aggressive profit-taking. Crypto analyst Crazzyblockk explained These metrics indicate a zone of high risk where volatility could increase in the short term, while the overall bullish trend continues.
Hyblock Capital, a trading platform for Bitcoins, has noted that the open interest in Bitcoins is “approaching frothy levels.”
“Historically when this happens [and] Fear & Greed Index is in “Extreme Greed” territories –> we get local tops and corrections. Those bright red highlights are when both conditions occur. Historically, these play out over much longer timeframes, so don’t go rushing into a trade right away.”
Related: Bitcoin digests US PPI win with $120K liquidity grab on bulls’ radar
Are Bitcoin owners prone to panic, or should they be patient?
Bitcoins Recent Dip triggered Axel Adler Jr., a Bitcoin researcher, says that there was a panic-sale of nearly 50,000 BTC within 24 hours. Investors were clearly anxious after BTC fell from its recent highs.
However, data suggests A stronger purchasing interest was seen after the price drop. Bitcoin’s heatmap of cost-basis distribution shows that between $116,000 to $118,000, investors have accumulated more than 196,600 BTC worth over $23 billion. This substantial dip-buying, which is despite the signs of fear-driven sales, underscores market confidence in Bitcoin’s long-term trajectory.
A technical point of view, Bitcoin will remain firmly in its bullish long term structure for as long it is consolidating above the level $112,000 A period of minor sideways movement, or even a pullback, after a 19% surge is healthy. It allows the market time to settle down and flush out any excess leverage.
Although the recent bearish-engulfing patterns may be a sign of short-term exhaustion, or an eventual reversal in the trend, they do not invalidate it. BTC’s upward trend is likely to continue as long as the key support level of $112,000 remains intact.
Related: Bitcoin ‘not at peak yet’: Watch these BTC price levels next
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Source: cointelegraph.com
