Bitcoin (BTC) continues to experience pressure as ongoing macroeconomic uncertainties impact its price movements. Following a notable rebound from a local low of about $75,000 on April 7 and 9, analysts are starting to speculate whether BTC might be on the brink of reversing the downward trend that has dominated since the beginning of the year.
For some, like seasoned trader Peter Brandt, this trendline might just be wishful thinking. In a recent post on X, he remarked,
“Of all chart constructions, trendlines are the LEAST significant. A trendline break does NOT indicate a change in the BTC trend. Sorry.”
Conversely, others are expressing cautious optimism. Analyst Kevin Svenson pointed out a potential weekly RSI breakout, emphasizing that “Once confirmed, weekly RSI breakout signals have historically been among the most dependable macro breakout indicators.”
Ultimately, price movements are influenced by supply and demand—and while both facets are beginning to display slight signs of recovery, they have not yet reached the necessary thresholds for a valid breakout. Furthermore, the bulls will need to navigate a significant sell wall around $86,000 to affirm a trend reversal.
Bitcoin Demand — Are There Initial Signs of Recovery?
As reported by CryptoQuant, Bitcoin’s perceived demand — calculated by the 30-day net difference between exchange inflows and outflows — is showing early indications of recovery after a prolonged dip into negative values.
However, analysts advise caution against hasty declarations of a trend reversal. Reflecting on the 2021 cycle peak, similar situations arose: demand hovered at low or negative levels for months, prices temporarily stabilized or rebounded, and actual structural recovery followed extended periods of consolidation.
This recent uptick in demand may merely signify a pause in selling pressure—not a definitive bottom signal. Time and confirmation are essential to validate a shift in momentum.
From the perspective of traders, the perceived demand metric does not appear overly promising at this stage. Current daily trade volumes for Bitcoin stand around 30,000 BTC (spot) and 400,000 BTC (derivatives), per CryptoQuant’s data. This represents a reduction of 6x and 3x, respectively, when compared to the June-July 2021 period that preceded the previous bull run of the 2019-2022 cycle. Despite positive comparisons of the current price dip to that timeframe, the current volume dynamics hint at a more subdued trader appetite.
Institutional investors substantiate the low demand trend. Since April 3, spot BTC ETFs have experienced continuous outflows exceeding $870 million, with the first slight inflow not recorded until April 15. Nevertheless, trading volumes remain relatively robust — sitting around 18% below the 30-day average — suggesting that some investor interest in Bitcoin persists.
Related: Crypto in a bear market, rebound likely in Q3 — Coinbase
Bitcoin Supply — Will Liquidity Return?
On the supply side, liquidity appears weak. Glassnode’s latest report indicates that realized cap growth has decelerated to 0.80% per month (from 0.83% previously), indicating a continued scarcity of meaningful new capital entering the Bitcoin network, which, as Glassnode notes, “remains significantly below typical thresholds for bull markets.”
Additionally, the BTC balance on exchanges—often monitored to gauge available sell-side liquidity—has plummeted to just 2.6 million BTC, the lowest since November 2018.
Yet, at a broader macroeconomic level, some analysts find grounds for cautious optimism. Independent market analyst Michael van de Poppe highlighted the rapidly increasing M2 Supply, which, with a certain delay (approximately 12 weeks), has historically influenced Bitcoin’s price.
“If the correlation persists,” he commented, “I expect that we will witness Bitcoin rallying to an all-time high during this quarter. This would also suggest a rise in CNH/USD, a drop in yields, a decline in gold prices, a decrease in DXY, and an increase in altcoins.”
Nonetheless, even if bullish momentum and demand resurface, Bitcoin must navigate a crucial resistance zone between $86,300 and $86,500, as depicted on CoinGlass’ liquidity heatmap, which illustrates dense clusters of buy and sell orders across various price levels.
Alphractal provides further insights through its Alpha Price Chart, which incorporates realized cap, average cap, and on-chain sentiment — arriving at a similar conclusion. According to the chart, BTC must decisively surge past $86,300 to revive short-term bullish sentiment. Should the price weaken again, support levels are positioned at $73,900 and $64,700.
In conclusion, proclaiming a trend reversal at this stage may be hasty. Liquidity remains scarce, macroeconomic pressures linger, and investor sentiment stays cautious. Nevertheless, Bitcoin’s stability above $80,000 indicates robust support from long-term holders. A decisive breakout above $86,300 could alter market sentiment—and, ideally, trigger a new rally. However, for any significant movement to occur, it must be substantiated by genuine spot market volume, rather than merely leverage-driven activities.
This article does not offer investment advice or recommendations. Every investment and trading decision carries risks, and readers should conduct their own research when making decisions.
