Bitcoin Realized Profits Drop To 2021 Peak Levels – Bullish Rallies Historically Begin At Lower Values

Bitcoin’s sentiment has taken a sharp turn, moving from bullish optimism above the $100K mark to growing fear as the price hovers around $95K. The much-anticipated clean breakout after reclaiming the $100K level has failed to materialize, leaving investors questioning the strength of the current bull trend.

Top analyst Axel Adler shared insightful data on X, revealing a notable shift in the market’s realized profit metrics. The average daily realized profit has dropped from $136M to $93M, signaling a cooling phase. Despite this decline, the current realized profit levels remain comparable to the peaks of the 2021 cycle, highlighting the ongoing strength and activity within the market.

This data underscores the duality of the current situation: while Bitcoin still shows signs of resilience, the failure to sustain momentum above the $100K mark has introduced uncertainty into the market. Analysts and investors are now closely watching the $95K level, a critical support zone that could determine whether Bitcoin regains its bullish trajectory or faces a deeper correction. The coming days will be crucial as the market seeks clarity and direction in this pivotal phase.

Bitcoin Metrics Set A Market Picture

Bitcoin’s current phase is a consolidation, a typical behavior after breaking significant psychological and technical levels. Since Bitcoin first crossed the $100K mark on December 5, the price reached an all-time high of around $108K before consistently consolidating below the $100K threshold. This period of sideways action has introduced mixed sentiments, with bulls eager for another leg up and bears eyeing potential corrections.

Analyst Axel Adler shared critical insights on X, highlighting a drop in the average volume of realized profit from $136M/day to $93M/day. Despite this decrease, Adler points out that these figures remain comparable to the peak of the 2021 cycle, showcasing robust market activity. Historical data reinforces this perspective, as September 2021 and 2024 both saw mini-bullish rallies begin when average daily realized profits were approximately $15M—a fraction of the current levels.

It’s important to note that Adler’s analysis relies on 30-day moving averages, which smooth out short-term fluctuations but also mean that actual realized profits are significantly higher. For instance, on November 21, 2024, one month after the rally began at $98K, daily investor profits soared to $443M.

These metrics suggest that while Bitcoin is consolidating, underlying market activity remains strong, laying the foundation for a potential bullish continuation. If BTC holds key levels, another surge to test or surpass recent highs could be on the horizon.

BTC Technical View: Key Levels To Hold

Bitcoin is trading at $95,400 after losing key levels, including the psychological $100K mark, the 4-hour 200 MA at $98,290, and the EMA at $96,480. This series of breaks indicates short-term bearish price action, raising concerns among investors about the potential for further downside.

However, despite this aggressive selling pressure, some analysts suggest that this could be a move to generate liquidity before another push higher. This kind of volatility is not uncommon during consolidations near critical levels, especially after a significant rally like the one Bitcoin experienced in December.

The $95K mark now serves as a pivotal support zone for bulls. If BTC manages to hold this level in the coming hours, it could signal the end of this bearish phase and set the stage for a quick recovery. Reclaiming the $96,480 EMA would be an encouraging first step, while a move above the $98,290 4-hour 200 MA would confirm a return to bullish momentum.

Market participants are closely monitoring these levels, as a sustained hold above $95K could reignite confidence and set Bitcoin back on its upward trajectory. However, failing to maintain this support could lead to deeper corrections in the short term.

Featured image from Dall-E, chart from TradingView