Bitcoin struggles to regain momentum – Is the rally truly over?
Bitcoin (BTC) has faced two unsuccessful attempts at recovery in recent weeks, raising concerns over whether the leading cryptocurrency has exhausted its bullish momentum. While some data points hint at renewed accumulation, market signals suggest that the rally may be stalling.
Large-scale investors, often referred to as “whales,” have become more active, with a notable increase in BTC transfers to major exchanges like Binance. The 7-day average of whale inflows (in the 1,000–10,000 BTC range) spiked to levels not seen since July. This trend often indicates that institutional players are repositioning — either preparing to offload assets or rebalance portfolios amid shifting market dynamics.
However, despite these inflows, long-term netflows have turned negative. This means that, overall, more Bitcoin is being withdrawn from exchanges than deposited, a potential indication of accumulation by long-term holders (LTHs). When investors move their coins off exchanges, it typically signals an intention to hold rather than sell, pointing to growing confidence among committed market participants.
Still, the broader market outlook remains cautious. Bitcoin’s price has recently cooled from its peak of $124,000, sliding into the $104,000–$110,000 range. Though it continues to hover above key support zones, attempts to break higher on October 13 and 20 failed to gain sustainable traction. The first rally showed some promise but quickly collapsed under resistance, while the second lacked the necessary volume and momentum to make an impact.
According to technical analysts, Bitcoin’s momentum index remains stuck below the 45 mark — a level often associated with bearish conditions. Additionally, BTC is trading below its 30-day Fair Value, signaling that buyers may be stepping back and allowing the market to consolidate.
The softening of futures flows further supports the idea that bullish energy is waning. With less capital flowing into leveraged positions, traders appear more risk-averse, possibly awaiting stronger signals before re-entering the market.
Despite these headwinds, there are subtle signs of resilience. The sharp drop in Binance’s netflows — which now show more Bitcoin leaving than entering — suggests that some investors view the recent dip as a buying opportunity. Historically, strong accumulation during price stagnation has often preceded major upward movements.
Long-term holders, who typically accumulate during market lulls, seem to be stepping back in. Their activity may be laying the groundwork for a more sustainable upward trend, even as short-term traders retreat or secure profits.
It’s also worth noting that institutional interest hasn’t disappeared. While they may be less visibly aggressive, institutions are likely recalibrating their strategies in anticipation of the next significant market shift. Their current behavior — moving assets onto exchanges and withdrawing shortly after — supports the theory of strategic repositioning rather than widespread selling.
In broader context, Bitcoin’s price behavior reflects a familiar pattern of consolidation following sharp rallies. Such pauses often serve to reset market sentiment and absorb profit-taking before the next major move. While the recent failures to sustain a breakout have dampened short-term enthusiasm, they don’t necessarily indicate a full reversal of the longer-term bullish trend.
Looking ahead, key metrics to watch include the strength of exchange outflows, on-chain activity from long-term wallets, and whether BTC can reclaim its 30-day Fair Value with conviction. A decisive move above resistance levels, supported by strong volume and futures interest, would signal a return of bullish momentum.
Until then, Bitcoin appears caught in a transitional phase — not quite bearish, but lacking the drive to push significantly higher. For seasoned investors, this may be a time to monitor rather than act, as the market continues to digest recent gains and prepare for its next directional decision.
New developments to consider:
1. Miner activity: Miners have recently reduced the amount of BTC sent to exchanges. This could indicate that they are waiting for higher prices to sell, suggesting a belief that the current dip is temporary.
2. Network health: The Bitcoin network remains robust, with hash rates near all-time highs. This reinforces confidence in the network’s security and overall ecosystem resilience.
3. Market sentiment: Sentiment indicators are shifting into neutral territory. While extreme fear is absent, so is the euphoria typical of strong bullish phases. This neutrality may set the stage for a stronger move in either direction.
4. Macroeconomic factors: Global monetary policy continues to influence crypto markets. With interest rate expectations fluctuating, Bitcoin’s role as a hedge or risk asset could shift depending on macroeconomic data.
5. ETF developments: The market remains sensitive to news about Bitcoin ETF approvals or institutional adoption. Any positive development in this area could reignite bullish momentum.
6. Altcoin correlation: Bitcoin’s dominance has slightly weakened, with some capital rotating into altcoins. This often happens during periods of BTC consolidation and could signal a wider diversification trend among investors.
7. On-chain metrics: Metrics like the MVRV (Market Value to Realized Value) ratio suggest that Bitcoin is neither overvalued nor undervalued at current levels. This further supports the idea of a market in balance, waiting for a catalyst.
In conclusion, while Bitcoin’s recent failures to rally have cooled enthusiasm, the underlying data does not point to a full-scale bearish reversal. Instead, the market appears to be in a holding pattern, with long-term buyers quietly accumulating in the background. Whether this sets the stage for the next bull run will depend on upcoming technical confirmations and macroeconomic conditions. For now, Bitcoin is not out of fuel — it may simply be idling before its next major move.