bitcoin fell back below $80,000 on Wednesday after a brief breakout attempt, as on-chain data suggested the rally was already encountering profit-taking pressure.
CryptoQuant said bitcoin’s 37% rebound from April lows still looks more like a bear market rally than a confirmed trend reversal, with realized gains reaching their highest level since December and short-term holders increasingly exiting with profits.
Bitcoin’s rally has put traders back into profit, with holders cashing out at the fastest pace since December, as recent buyers sell increasingly hard, they wrote.
But the rally still looks more like a relief rally than a true bull market breakout, as gains remain well below levels seen in sustained uptrends in the past, while unrealized gains are already high enough to tempt more selling, according to CryptoQuant. Traders are also counting on an unrealized profit margin of 18%, the highest since June 2025, a level at which profit-taking has historically accelerated.
Singapore-based market maker Enflux offered a different read, focusing less on holder behavior and more on the macro catalyst that fueled bitcoin’s initial move higher.
Enflux said bitcoin’s push above the $80,000 level was part of a broader risk-on reaction after President Donald Trump halted a U.S. naval operation linked to tensions around the Strait of Hormuz, a move that sent oil prices lower and stocks higher.
But while Enflux said the rally “makes sense mechanically,” it warned that markets could be overestimating the durability of the catalyst, noting that Trump’s previous diplomatic pauses since March were reversed within days or were misinterpreted by traders.
Glassnode, however, offered a more constructive view, arguing that bitcoin’s recent move reflects an early structural recovery rather than simply a short-lived macroeconomic bounce.
The analytics firm said bitcoin had reclaimed two closely watched on-chain levels in a note this week: the true market average at $78,200 and the short-term holder cost base near $79,100, levels that often serve as dividing lines between weaker and stronger market regimes.
Glassnode identified around $85,200 as the next major resistance zone, while noting an improvement in US spot ETF inflows and persistent negative perpetual funding, a sign that some traders remain positioned for the downside even as prices recover.
Still, Glassnode stopped short of declaring a clean leak.
Long-term holders are starting to take profits, while high realized losses across the market suggest Bitcoin still needs stronger spot demand to sustain a longer-lasting bullish move.
Prediction markets reflected similar caution. On Polymarket, traders assigned relatively low odds to Bitcoin clearly extending towards $85,000 or higher this week, suggesting the market remains hesitant to treat the recent rally as a confirmed breakout.
