Bitcoin’s recent rally, which saw the cryptocurrency climb past the $104,000 mark and register a nearly 10% weekly gain, hit a standstill. After touching these heights, the digital coin seems to have met resistance, with its upward trajectory losing speed and price movements remaining mostly unchanged over the last few days.
At the moment, Bitcoin trades at $103,663, representing a slight 1.7% increase over the last 24 hours. Darkfost, one of CryptoQuant’s leading analysts, provided some insights into the current market stagnation.
According to Darkfost, the root of this slowdown can be traced back to activity in the derivatives market. He pointed towards the cumulative net taker volume, a metric that reflects the net volume of market orders, which has remained negative since BTC surpassed the significant $100,000 mark.
This indicates the prevalence of aggressive sell orders (shorts) over buy orders (longs), thus exerting a consistent downward pressure on the price. Net taker volume serves as a valuable indicator of current trader sentiment; a negative trend usually hints at an expected price slump, spurring more short-selling.
Darkfost emphasized that this trend reflects growing doubts among traders concerning Bitcoin’s short-term potential to hit new all-time highs. Despite a positive long-term sentiment, the imbalance in derivatives activity suggests a cautious stance among market participants.
Simultaneously, technical analyst Javon Marks pointed out chart patterns hinting at a possible continuation of Bitcoin’s bullish trend. He noted the formation of a bull flag, often seen as a breather before an upward movement resumes. If this plays out, it could signal a recommencement of upward pressure and pave the way for another upward stride.
Marks also observed that altcoins are showing similar patterns to those seen in previous market cycles, especially the surges of 2017 and 2021. He suggested that the current phase might precede a more extensive altcoin rally, which typically follows Bitcoin’s movements.
